Evotec: A Predictable Crash! Or Is This the Big Turnaround?
The stock of the Hamburg-based biotech company Evotec has literally collapsed in recent months. In November 2024, the share was still trading well above EUR 10; today, it is trading at a meagre EUR 3.30. That represents a significant decline of nearly 70%. It is a crash that is causing serious unease among investors. The 2026 half-year results also reveal an operational disaster: revenue plummeted by 19.2% to EUR 300.1 million, and adjusted EBITDA slipped to minus EUR 42.7 million. Management has reduced its full-year revenue guidance, cutting it from the previous forecast of EUR 780 million to just EUR 610 million. Instead of the hoped-for profit, a loss of up to EUR 105 million is now on the horizon.
Evotec’s business model is based on drug discovery for pharmaceutical and biotech partners. The problem, however, is that major contracts are not materializing, the market environment is weak, and the company’s own pipeline is not delivering quick wins. The operating margin is deep in the red, and profitability remains a distant prospect. There are at least some early signs of hope. The “Horizon” cost-cutting program is expected to generate EUR 75 million in annual savings by the end of 2027. In addition, Evotec has launched an AI collaboration with Odyssey Therapeutics focused on autoimmune diseases. That at least offers a glimmer of hope for the future.
There is no consensus on the valuation. RBC Capital Markets continues to see potential and reaffirms an “Outperform” rating with a price target of EUR 10.00. Other firms, such as Berenberg, have downgraded the stock to “Hold” and cut the price target from EUR 9.40 to EUR 3.60. Evotec does not pay a dividend. The investment thesis, however, is clear: anyone investing here is betting on a successful turnaround, which comes with high risk but also the chance of a massive recovery should “Horizon” prove successful.
Evotec is a classic turnaround candidate with significant downside risk. The stock is therefore not for the faint of heart. However, one thing must be clear: investors betting on an operational turnaround will need to be patient.
Palantir: The AI Rocket is Making Short Sellers Tremble
While Evotec struggles, Palantir is celebrating one success after another. The US software company, which specializes in data analysis and AI, posted breathtaking growth in the second quarter of 2026. Revenue surged by 93% to USD 1.94 billion. The US commercial business, that is, business with enterprises, even grew by 149% to USD 764 million. The government segment also grew strongly by 90% to USD 809 million. The operating margin reached a record high of 62%, and net income tripled to USD 1.07 billion. These figures are simply impressive and underscore Palantir’s role as one of the big winners of the AI boom.
Palantir’s business model is based on connecting data silos and providing AI-powered decision-making platforms for government agencies and companies. The company’s so-called “ontology” is considered difficult to replicate. The Pentagon, in particular, relies on Palantir. A sole-source contract worth USD 243.9 million through March 2027 underscores its strategic importance. Analysts are enthusiastic. Deutsche Bank upgraded its rating from “Hold” to “Buy” with a price target of USD 200, while Phillip Securities raised its target to USD 215.
But there are also cautionary voices. Morningstar estimates fair value at USD 153 and thus considers the stock fairly valued. The price-to-earnings (P/E) ratio of over 140 is extremely high. Short sellers already suffered billions in losses during the last rally. Short interest stands at around USD 12 billion. In any case, Palantir does not pay a dividend. The investment thesis is that the company is currently the clear market leader in the AI segment for government agencies and large corporate clients. Those betting on continued strong growth could be rewarded, but the risk of a correction in the event of a slowdown in growth is real.
Palantir is currently one of the winners in the AI sector, but its valuation is quite ambitious. The stock is a momentum investment with high risk but equally high potential.
dynaCERT: The Underdog — Breakout in Sight!
We turn to dynaCERT. The Toronto-based Canadian company has developed a technology with the potential to revolutionize diesel engines in a sustainable way. The HydraGEN™ technology produces hydrogen and oxygen on demand and feeds these gases directly into the air intake of diesel engines. The result: combustion becomes more efficient, fuel consumption decreases, and emissions are reduced. The scientific basis is that hydrogen has a flame speed nine times that of diesel, resulting in faster, more complete combustion. Even small amounts of H₂ and O₂ improve specific fuel economy, regardless of engine load.
dynaCERT’s business model is simple, patented, and scalable. The company sells its retrofit HydraGEN™ systems as an aftermarket solution for trucks, construction machinery, ships, and locomotives. The Smart-ECM control system enables precise adaptation to various engine types. Through intensive development work, the system has been optimized for robustness and cost-effectiveness. The benefits for customers include reduced fuel costs and lower emissions. This could, in turn, extend engine oil life.
Given rising environmental regulations worldwide, dynaCERT’s technology appears to be coming at just the right time.
The stock is currently trading at CAD 0.105. It has been moving within a wedge pattern for some time—a technical chart pattern that often signals an impending breakout. The key levels are at CAD 0.11 and CAD 0.12. A breakout above these resistance levels could propel the stock toward CAD 0.15 to 0.20. However, there was already an attempted breakout a few weeks ago that was repelled by the bears. The technical pattern remains intact.
Anyone who believes in the future of hydrogen technology for combustion engines could find dynaCERT an interesting early-stage investment opportunity with significant potential. The technology works, the market is growing, and the stock appears to be waiting for the decisive breakout.
Evotec is fighting for survival and is a risky bet on an operational turnaround. Palantir is the shining star of the AI boom, but its extremely high valuation leaves little room for disappointment. And dynaCERT is in an exciting technical phase. The stock is at the lower end of a wedge pattern and is awaiting a decisive catalyst. Should it break out above CAD 0.11 or 0.12, the path could be clear to CAD 0.15 to 0.20. Investors looking for a speculative yet technologically sound opportunity should keep an eye on dynaCERT.
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