What is going on? Sharp price swings for Almonty Industries, Klöckner & Co., and RENK!

Almonty Industries – Surprising capital increase of USD 112.5 million

Investors have been eagerly awaiting the start of production at the Sangdong tungsten mine in South Korea for some time. Equipped with this world-class asset, Almonty's share price has rallied spectacularly in recent months. Now, shortly before the finish line, the Company has surprised everyone with a capital increase.

Currently, 18 million shares are being offered at a price of USD 6.25, which is a significant discount to the previous day's closing price. In addition, Almonty has granted the syndicate banks a 30-day over-allotment option to purchase up to 2.7 million additional shares at the public offering price less the issue discount. The transaction is being led by Bank of America as lead bookrunner.

The proceeds from the offering will be used in particular to finance exploration and development work on the recently acquired Gentung Browns Lake tungsten project in the US and expansion work at the Panasqueira mine in Portugal. The funds will also be used for further exploration work on the Sangdong molybdenum project in South Korea.

At full production capacity, Sangdong is expected to cover over 80% of Western non-Chinese tungsten production. China, Russia, and North Korea currently dominate the market. Sangdong, therefore, has geopolitical significance. In recent months, Almonty has already announced the conclusion of long-term offtake agreements with attractive price floors. Most recently, CEO Lewis Black reported growing interest and ongoing discussions with many governments.

Demand for this strategic metal, which is indispensable to the defense industry, aviation, and high-tech sectors due to its hardness and heat resistance, remains unbroken, which is reflected in historically high prices. This plays into Almonty's hands, as the mine design is geared to generate profits even at low prices. In addition, according to Almonty, the facilities are likely 10 years or more ahead of Chinese production facilities in terms of technology.

To prepare for strong growth in the future, the Company recently expanded its management team and appointed retired Brigadier General Steven L. Allen as Chief Operating Officer. Allen brings extensive expertise in logistics and multinational organizations and has significant experience in the South Korean market.

The current capital increase is a logical step to expand the shareholder base in the US. Almonty is planning to relocate its headquarters to the United States. From January 1, Nasdaq will be the main stock exchange for the shares, but a listing on the Canadian stock exchange will be maintained. The recently acquired tungsten project in the US state of Montana is scheduled to go into production in the second half of 2026. The strong geopolitical weight and high tungsten prices suggest that the stock will continue to perform well.

Klöckner & Co – Takeover speculation fuels share price

Burgeoning takeover speculation has caused the steel trader's shares to rise by 30% in the short term. The Company published information that the US group Worthington Steel is currently reviewing the books and considering a takeover bid for all shares. Other industry representatives, such as Salzgitter and thyssenkrupp, benefited only briefly from the news.

The Company is currently valued at EUR 770 million, which corresponds to approximately 0.12 times this year's expected revenue. Analysts expect the Company to post losses of around EUR 40 million this year and return to profitability next year on the basis of a roughly 10% increase in revenue. Analyst estimates prior to the announcement of the takeover talks showed an average price target of around EUR 8.

RENK – Strong growth ahead

Sentiment is once again favorable for defense stocks. In this environment, RENK's share price rose again. The shares are the best performers in the sector this year. After reaching highs of around EUR 90, the current level of EUR 56 and a market capitalization of EUR 5.6 billion once again offer an attractive level. On average, analysts are forecasting a target price of EUR 67.

RENK stands out from its competitors thanks to its extremely strong competitive position in safety-critical drive systems for armored vehicles and ships. As a technologically virtually irreplaceable specialist supplier with a quasi-monopoly market position, the Company also benefits from high market entry barriers.

Current and forecast growth also speak in favor of the stock. The target for the current fiscal year is revenue of EUR 1.3 billion and adjusted operating profit of EUR 210 to 235 million. These figures are expected to increase significantly by 2030. The Company's long-term outlook includes an increase in revenue in the range of EUR 2.8 billion to EUR 3.2 billion. Acquisitions are also conceivable, which could increase revenue by up to EUR 1 billion.

Almonty's price correction offers an attractive level. The strong strategic weight of the Sangdong mine, high tungsten prices, and increasing awareness among US investors suggest that the stock will continue to perform well. Klöckner & Co. is in a special situation due to takeover talks. RENK is attractive based on high defense budgets and its strong competitive position.