May 12th, 2025 | 07:10 CEST
Is RENK riding the next wave? Heidelberg Materials and Argo Living are at the forefront of sustainability!
Russia's war of aggression against Ukraine and the recent tensions in transatlantic relations have triggered a profound change in the financial sector. Today, Fund managers ask themselves which criteria can be used as "ESG-compliant" or "sustainable" in this new era. The industry remains divided when it comes to defense companies. Nevertheless, fund managers are almost forced to invest in defense in order not to miss out on the steep return trend in 2025. Investors find themselves caught between expected returns and the desire for peace and stability. For RENK shares, this dilemma has given rise to dream returns that, in our view, are not yet reflected in the current figures. Heidelberg Materials and Argo Living, on the other hand, are focusing on sustainable products and have delivered impressive balance sheets so far. Investors should proceed selectively.
time to read: 4 minutes
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Author:
André Will-Laudien
ISIN:
HEIDELBERGCEMENT AG O.N. | DE0006047004 , ARGO LIVING SOILS CORP | CA04018T3064 , RENK AG O.N. | DE000RENK730
Table of contents:
Author
André Will-Laudien
Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.
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Heidelberg Materials – Good figures at the start of the year
A glance at Heidelberg Materials' product range reveals a comprehensive portfolio of products such as cement, ready-mixed concrete, and aggregates such as sand, gravel, crushed stone, and asphalt. This range of construction materials is complemented by services such as international trade in cement and coal. As part of its strategy for the future, Heidelberg Materials aims to generate half of its consolidated sales with sustainable products by 2030. With its "evoBuild" and "evoZero" series, the Company bundles CO₂-reduced and circular building materials. All products in these series must meet strict criteria, such as a minimum 30% reduction in CO₂ compared to the global reference values of the Global Cement and Concrete Association (GCCA). evoZero is the world's first net-zero cement produced using carbon capture and storage (CCS) technology. The Company's figures for the first quarter of 2025 impressed analysts. Despite the economic slowdown, revenues rose by 5% to EUR 4.715 billion, while profits from ongoing operations remained just above the previous year at EUR 235 million. On the LSEG platform, 12 out of 22 experts recommend buying the Heidelberg-based company, but the average 12-month price target of EUR 169.50 is below the current price of around EUR 184. The announcement of the new German government's billion-euro infrastructure stimulus package for the coming years is certainly having a distorting effect. Set your profit target at the support line of around EUR 172.
Argo Living Soils Corp. – Green concrete for future generations
Since its founding in 2018, the Company has specialized in the manufacture and development of organic products, including biochar, soil improvers, and biofertilizers. Most recently, it has also been focusing on green concrete solutions. Argo's goal is to reduce global carbon emissions through sustainable agricultural and industrial innovations and to create a renowned brand for environmentally friendly products. Argo Living is thus addressing important trends in the sustainable circular economy and is a focus for ESG-oriented partnerships and investors. The recently established research and development agreement with Graphene Leaders Canada (GLC), an Alberta-based leader in high-quality dispersions of graphene and carbon nanomaterials, is very promising. The goal is to develop a graphene nanoplatelet (GNP) additive for ready-mix concrete. The project proposal represents a significant step in the expansion into the green concrete market through its subsidiary Argo Green Concrete Solutions Inc., which uses Biograph technology to produce stronger, more sustainable concrete products.
Among the current trends in the infrastructure market, the corresponding figures from the North American ready-mixed concrete market are also noteworthy. Sales were estimated at around USD 250 billion in 2024 and are expected to grow at a compound annual growth rate (CAGR) of 4.5% through 2030. Key drivers are infrastructure development and the growing demand for sustainable building materials. Argo's initiative is in line with this trend and aims to provide environmentally friendly solutions that meet the evolving needs of the construction industry. Concrete production is one of the largest industrial sources of carbon dioxide emissions, accounting for 8% of global emissions. New research and scientific studies suggest that incorporating graphene into concrete offers transformative benefits such as reduced water requirements, increased strength and durability, and a 20% reduction in greenhouse gases.
The project will start in May, with both parties committing to deliver a joint proof of concept for improving concrete properties using their forward-looking technology approaches. With 18.3 million shares issued, the Company is valued at approximately CAD 9.5 million. The share price already quintupled in January and, following a recent consolidation to CAD 0.50, once again offers a good entry point. The topic is relevant to the international climate agenda and, once implemented, will be the focus of important government contracts. The US development aid agency USAID estimates that Ukraine will need to produce around 15 to 16 million tons of cement annually during a three-year reconstruction phase to come close to meeting demand. This could be a game changer for Argo Living!

RENK – Sustainably too expensive
As stated on the RENK website, the Company sees itself as responsible for contributing to society's economically stable and ecologically responsible development. As a supplier of propulsion technology for military vehicles and naval vessels, RENK significantly contributes to preserving freedom, democracy, and security. Investors have likely focused on the military segments of the Company's structure in recent weeks and therefore added the stock to their investment universe. With a 12-month performance of +99%, the stock stands out clearly on German selection lists. Meanwhile, at prices of around EUR 58 and a market capitalization of EUR 5.8 billion, estimated revenues for 2025/26 are valued at a sales multiple of 4 to 5. With P/E ratios of 42 and 33, RENK appears to be a good three times as expensive as it was when it went public in 2024. Investors should therefore urgently secure their profits with tight stops, as there is a considerable price risk here if a negotiated solution is reached in Ukraine.
Selecting stocks on the stock markets is becoming increasingly difficult after a solid 17% index performance in 2025. Not even the uncertainty caused by Trump's announcement of new trade tariffs was able to slow down the upturn in blue chips in the long term. However, some small caps are still trading at correction levels. These include the up-and-coming Argo Living Soils, which has above-average opportunities in the current environment with its sustainable concrete solutions.
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Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") currently hold or hold shares or other financial instruments of the aforementioned companies and speculate on their price developments. In this respect, they intend to sell or acquire shares or other financial instruments of the companies (hereinafter each referred to as a "Transaction"). Transactions may thereby influence the respective price of the shares or other financial instruments of the Company.
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