Another 30 per cent upside with Renk shares? Analysts believe the defense company has room to grow. However, they are largely alone in this view, and the share price has already performed well. The situation is different for dynaCERT (TSX:DYA). The cleantech company is recommended as a “Buy” with 300 per cent upside potential. With a German top management team, revenue is expected to multiply in the coming years, making the stock look like a bargain at current levels. Meanwhile, the Nel share appears cheap on the surface. However, the euphoria over Samsung’s entry was short-lived, and a potential military order has failed to spark momentum. Was the market reaction justified?
Rising demand, increasing production, and a buy recommendation – dynaCERT (TSX:DYA) seems to be finally making the breakthrough this year, and the share price is set to multiply. Last week, GBC Research issued a “Buy” recommendation for dynaCERT shares. The analysts believe that the cleantech company’s shares are capable of reaching a price of EUR 0.48. The closing price on Tradegate on Friday was EUR 0.11. This suggests a potential price gain of more than 300 per cent.
There are good reasons for the analysts’ optimism. dynaCERT has developed a market-ready solution for reducing CO₂ emissions and improving fuel efficiency in diesel engines with its HydraGEN™ technology. The technology generates hydrogen and oxygen “on demand” and is used in the transportation, construction, and energy sectors. The system is complemented by HydraLytica™, a telematics software for evaluating savings and CO₂ reductions in order to then generate income through carbon credit certificates.
Last year, German management was brought on board. This year, strong demand has already been reported. Customer feedback, for example from the mining industry, has been very positive. As a result, dynaCERT announced the construction of 1,000 HydraGEN HG1 units a few weeks ago. The Company is pursuing a clear strategy to enter series production. A look at the production process can be seen in the latest video from Stockhouse Media Link).
GBC analysts expect dynaCERT to increase its revenues from CAD 2.4 million to CAD 12 million this year. Next year, revenue is projected to reach CAD 21 million, with a profit of CAD 5.77 million or CAD 0.01 per share. Given the anticipated rapid growth, the current price of CAD 0.17 seems too low Research).
Renk: Up another 30%?
dynaCERT is not the only company poised for strong growth in the years ahead. Renk, a maker of transmissions for tanks and other military vehicles, also appears to be on the threshold of a golden future. Unlike dynaCERT, however, the stock already seems to have priced this in to a large extent. After all, Renk’s shares have already more than doubled in the current year alone. With a closing price of EUR 44.53 on Friday, numerous analysts’ price targets have been reached.
Significant price potential is currently only seen by the analysts at Hauck Aufhäuser. They recently confirmed their “Buy” recommendation and raised their price target from EUR 35.50 to EUR 55.
The average price target for Renk shares has already been raised from EUR 30 to EUR 45 this year, according to marketscreener.com. However, analysts are lagging behind the share price. Eight out of eleven analysts currently recommend buying the stock. To give the stock further impetus, price targets would, therefore, have to be raised.
Nel ASA: Losing steam?
The short sellers are currently making money again with the Nel share. Although there has been further positive news flow from the hydrogen pioneer, the temporary price explosion has now been extinguished. Last week alone, the Nel share lost almost 17 per cent of its value again. This decline comes despite the former hydrogen high-flyer reporting an order from the US military. The US Navy Collins Aerospace has ordered PEM electrolyser stacks from Nel Hydrogen US. The stacks are to be installed in submarines and ensure the vital supply of oxygen. However, the order volume is only USD 6 million and delivery is expected to take several years.
Nevertheless, it is surprising that the stock has fallen back so sharply. After all, Samsung was announced as a new major shareholder on March 10. As part of a strategic partnership, the South Korean group is investing around NOK 353 million for a 9.1 per cent stake in the Company.
At Renk, the upside seems to be limited at the moment. The stock has simply performed too well. In contrast, dynaCERT is only just picking up speed. If further orders come in, GBC’s 300 per cent upside projection seems realistic. It is somewhat surprising that Samsung’s entry into Nel fizzled out so quickly. An opportunity, perhaps?
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