Friedrich Vorw
Price
Discussion sur VH2
Postes
9
Off to new stratospheres
According to initial projections, FRIEDRICH VORWERK will generate sales of over € 495 million in the 2024 financial year with an EBITDA margin of around 16%, thus significantly exceeding the forecast
Analyst updates, 13.01.25
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- GOLDMAN raises the price target for SIEMENS ENERGY from EUR 56 to EUR 60. Buy. $ENR (+2,8 %)
- BARCLAYS raises the target price for MERCEDES-BENZ from EUR 48.50 to EUR 50. Underweight. $MBG (+0,29 %)
- JEFFERIES upgrades SMA SOLAR from Hold to Buy and raises target price from EUR 14 to EUR 20. $S92 (+3,09 %)
- GOLDMAN raises the price target for DEUTSCHE BÖRSE from EUR 226 to EUR 231. Neutral. $DB1 (+1,49 %)
- BOFA upgrades BBVA from Neutral to Buy and raises target price from EUR 11 to EUR 13. $BBVA (+1,52 %)
- WARBURG RESEARCH upgrades FUCHS SE from Hold to Buy. Target price EUR 50. $FPE
- GOLDMAN raises the price target for FLATEXDEGIRO from EUR 17 to EUR 18. Buy. $FTK (+1,37 %)
- BERENBERG raises the target price for IBERDROLA from EUR 12.30 to EUR 14. Hold. $IBE (+2,7 %)
- JEFFERIES upgrades PVA TEPLA from Hold to Buy and raises target price from EUR 12 to EUR 19. $TPE (+15,07 %)
- JEFFERIES raises the price target for FRIEDRICH VORWERK from EUR 23 to EUR 30. Hold. $VH2 (+2,17 %)
- JEFFERIES raises the price target for ZEAL NETWORK from EUR 45 to EUR 58. Buy. $TIMA (-0,69 %)
- JEFFERIES raises the price target for ADESSO from EUR 75 to EUR 85. Hold. $ADN1 (+1,92 %)
- JEFFERIES upgrades NEL from Underperform to Hold. Target price NOK 3. $NEL (+2,06 %)
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- BERENBERG lowers the price target for RWE from EUR 46.50 to EUR 42. Buy. $RWE (+2,56 %)
- GOLDMAN lowers target price for EON from EUR 17.50 to EUR 17. Buy. $EOAN (+2,09 %)
- HAUCK AUFHÄUSER IB downgrades AIXTRON from Buy to Hold and lowers target price from EUR 26.40 to EUR 13.80. $AIXA (+2,76 %)
- METZLER lowers the price target for DWS from EUR 41 to EUR 40.50. Hold. $DWS (+4,63 %)
- GOLDMAN lowers the price target for ASTRAZENECA from GBP 159.55 to GBP 155.58. Buy. $AZN (+1,19 %)
- TD COWEN downgrades STMICRO to Hold. Target price EUR 24.50. $STM (+0,28 %)
- JPMORGAN downgrades CONSTELLATION BRANDS to Neutral. Target price USD 203. $STZ (-0,88 %)
- JEFFERIES lowers the price target for DOCMORRIS from CHF 65 to CHF 39. Buy. $DOCM (+0,63 %)
- JEFFERIES lowers the price target for ATOSS SOFTWARE from EUR 112 to EUR 108. Hold. $AOF (+2,39 %)
- JEFFERIES lowers the price target for JENOPTIK from EUR 34 to EUR 29. Buy. $JEN (+2,94 %)
- JEFFERIES lowers the price target for KONTRON from EUR 29 to EUR 27. Buy. $KTN (+1,74 %)
- JEFFERIES lowers the price target for SILTRONIC from EUR 95 to EUR 90. Buy. $WAF (+3,47 %)
- JEFFERIES downgrades VERBIO from Buy to Hold and lowers target price from EUR 22 to EUR 11. $VBK (+3,94 %)
- JEFFERIES downgrades SGL CARBON from Buy to Hold and lowers target price from EUR 9.50 to EUR 4.40. $SGL (+1,05 %)
Analyst updates, 29.10. 👇🏼
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- JEFFERIES raises the price target for SAP $SAP (+1,59 %) from EUR 230 to EUR 255. Buy.
- DEUTSCHE BANK RESEARCH raises the price target for DEUTSCHE TELEKOM $DTE (+1,23 %) from EUR 33 to EUR 39. Buy.
- ODDO BHF raises the target price for ALLIANZ
SE
$ALV (+1,13 %) from EUR 288 to EUR 324. Outperform. - ODDO BHF raises the price target for DWS
$DWS (+4,63 %) from EUR 38 to EUR 39. Neutral. - METZLER raises the price target for LUFTHANSA $LHA (+1,66 %) from EUR 5.70 to EUR 6.40. Hold.
- METZLER raises the price target for NEMETSCHEK
$NEM (+3,07 %) from EUR 89 to EUR 91. Hold. - METZLER raises the price target for FRIEDRICH
VORWERK $VH2 (+2,17 %) from EUR 29.20 to EUR 38. Buy. - GOLDMAN raises the price target for SYMRISE $SY1 (-0,13 %) from EUR 127 to EUR 131. Neutral.
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- BOFA lowers the price target for MUNICH
RE
$MUV2 (+1,74 %) from EUR 550 to EUR 535. Buy. - WARBURG RESEARCH lowers the price target for WACKER
CHEMICALS $WCH (+0,76 %) from EUR 136 to EUR 133. Buy. - WARBURG RESEARCH downgrades STEICO
$ST5 (+3,18 %) from Buy to Hold and lowers target price from EUR 42 to EUR 29. - METZLER lowers the price target for SALZGITTER $SZG (-5,8 %) from EUR 17 to EUR 15.50. Hold.
- DEUTSCHE BANK RESEARCH lowers the price target for SGL
CARBON $SGL (+1,05 %) from EUR 10.80 to EUR 10.60. Buy. - LBBW downgrades PHILIPS $PHIA (+1,29 %) from Buy to Hold and lowers target price from EUR 30 to EUR 26.
- GOLDMAN downgrades ABB
$ABBNY (+0,9 %) from Buy to Neutral. Target price CHF 52. - UBS lowers the price target for CARL ZEISS MEDITEC $AFX (+1,32 %) from EUR 71 to EUR 65. Neutral.
- JPMORGAN lowers the price target for STMICRO
$STMPA (+0,54 %) from EUR 42 to EUR 35. Overweight.
The 1x1 of the hydrogen industry on the stock exchange.
Hello dear community,
In view of the fact that there are now a lot of newcomers on the platform, I've created a graphic, typical of social media, to give you an overview of stocks that not everyone may have on their radar. It goes without saying that you can't know your way around every sector. But we have come together here in the community for a solid exchange.
But since we're here on Getquin and not on Instagram, here's some input for the inquisitive.
What do the companies do anyway?
Service providers:
On the service provider side, there are some rather atypical companies for the sector.
Here I have Friedrich Vorwerk $VH2 (+2,17 %) Vinci $DG (+1,19 %) , Ferrovial $FER , Bilfinger $GBF (+5,82 %) and Jacobs Solutions $J (+0,48 %) are listed here.
Their main focus is the background work on the properties themselves. They support the companies in planning, realization, construction and maintenance. They work decentrally in regional working groups to cover the breadth of the industry. They offer almost every service for an industrial company.
The established elite
If you want to invest in the hydrogen sector, all roads lead to the giants Linde $LIN (+2,09 %) Air Products $APD (-1,89 %) and Air Liquide $AI (+2,02 %) . Their market power in the field of industrial gases and in today's market environment of commercial hydrogen production seems irrefutable. Their know-how in the gaseous material production segment has been tried and tested for decades and the processes are almost perfectly optimized. Each company also has its own engineering divisions, making them perfectly positioned for the future in electrolyzer development.
The established newcomers
With plenty of money in their pockets, the oil companies Shell $SHEL (+1,63 %) Total $TTE (+1,31 %) and BP $BP. (+2,13 %) are also entering the segment. Oil is finite, but the business should not be. These companies are also experienced in dealing with hydrogen. Hydrogen is an essential component in the refinery process. In order to become less dependent on the big 3, new market areas are also being explored here. Will they be able to prove themselves?
Speculative titles
Never anything but expenses. Years of hype and yet a harsh reality hit the small fish in the shark tank surrounding the segment. Nel $NEL (+2,06 %) Plug Power $PLUG (-7,95 %) and Ballard $BLDP (-0,85 %) are long-suffering. They have never been able to deliver even remotely profitable figures. On the contrary, things seem to be getting worse quarter after quarter. Only turnover is increasing. Can that ever be good?
Plant engineering and equipment
Of course, in a globalized world, you no longer take care of the entire value chain from A-Z. Every company specializes in its own segment. The long-term beneficiaries of the industry are therefore the equipment suppliers, because they have to develop the technical foundations for every innovation in order to survive in the vastness of globalization.
The plant manufacturers
They manufacture the physical parts for the process plants.
Examples of this are Voestalpine $VOE (+2,61 %) , Atlas Copco $ATCO B or Sulzer $SUNE .
The suppliers
The transportation of substances is also part of this. Material transport in industry, but also at home, for example in water pipes, is ensured by pumps (for liquids) or compressors (for gases). Established brands here are KSB $KSB (+2,59 %) , Xylem $XYL (+0,21 %) , Gorrman-Rupp $GRC (+1,37 %) but also as a complete supplier Chart Industries $GTLS (-0,56 %) or SKF $SKF B (+0,23 %) or for specialized tools Stanley B&D $SWK (-0,46 %) .
Process control is also indispensable. Brands such as Siemens $SIE (-0,17 %) ABB $ABBN (+0 %) or Rockwell $ROK (+0,24 %) and Parker $PH (+0,4 %) have established themselves here. They not only supply the electronic equipment for the process systems. They also offer their software services as safety services so that safety in process control can always be guaranteed.
I hope I have given you a little insight into the industry and would be delighted to receive constructive feedback.
Why "green" hydrogen can't live up to the hype. - Part 2
Values Community,
First of all, a big thank you that my last contribution on the subject of "hydrogen" was so well received or even sourly received.
In order to understand the context, I ask you to read part 1 as well, so that as few misunderstandings as possible occur.
https://app.getquin.com/activity/MDWIzGWvkU?lang=de&utm_source=sharing
Here again 5 reasons why the stock market values "green" hydrogen too high. Numbering follows the last post.
Please take a more speculative view. Clairvoyance is not my superpower.
6. storage medium, no energy carrier!
Contrary to the perception of many, hydrogen does not serve as an energy carrier, but as a storage medium.
Hydrogen can be produced extremely cheaply via electrolysis in the event of overproduction on the power grid. Why? The efficiency does not matter at all. The electricity is surplus anyway and is not needed anywhere else.
In fact, we would already have this surplus of electricity in Germany today. Due to the high prices, however, it is probably more lucrative to export it than to promote domestic electrolysers with it. It doesn't matter whether the electricity is generated from renewable sources or fossil fuels, and thus at least laying the foundations for a sustainable hydrogen industry. I can recommend the negative success story of the highly praised "WunH2" project in cooperation with Siemens. $SIE (-0,17 %) , can be recommended. The failure should, speculatively, have a signal effect.
7. geopolitics - finally new dependencies again.
Hydrogen should serve the general public accordingly for "everything". Heating medium, alternative fuel, chemical raw material, ...
However, nobody questions the production sites. These will not be able to take place in the temperate climate zones. Europe is also generally quite limited due to population density. This means that production sites are already being relocated to more southerly countries, such as those bordering the Mediterranean or African states. There are also concrete plans for hydrogen pipelines to Europe. Algeria, Angola, Egypt, ... These are all countries that are generally known for their legal security and economic obligations.
But what is the disadvantage, although it would of course be more efficient because of the solar intensity? We are once again becoming dependent, but in the case of an "energy turnaround" this will hit us much harder than the last time we were dependent on Russia.
None of today's investors can say in retrospect that they did not know this. $PLUG (-7,95 %) are already reaping the fruits of great investments, especially in Egypt, according to one magazine, or even the German flagship company $PNE3 (+1,95 %) with its involvement in South Africa.
8. safety first!
Hydrogen is probably the most dangerous gas in terms of explosiveness that could be handled. From a volume concentration of 18%, it inevitably leads to an explosion on contact with atmospheric oxygen! Furthermore, it is still flammable from 4% volume concentration.
Who wants to be around in the event of a leak from a pipe, container, motor vehicle, etc.? Volunteers? - Please don't!
Examples for the extent of such a reaction is for example the crash of the Hindenburg. Here, however, "only" a fire occurred, because the concentration of oxygen in the air was too low.
A possible solution would be the mixture with nitrogen. However, according to the risks involved, this would mean that a volume concentration ratio of approx. 95/5 would have to exist. This aspect alone again speaks in favor of the air separation giants Linde $LIN , Air Liquide $AI (+2,02 %) , Air Products $APD (-1,89 %) or also Nippon $4091 (+2,4 %) to name a Japanese company, which would find new sales opportunities in the field of nitrogen for safety reasons.
9. storage and capacities
A topic that is very rarely addressed, but is part of every value chain - storage.
It's not as simple as people like to think: "Let's just do away with natural gas and use the existing infrastructure for hydrogen." Nonsense! Hydrogen and natural gas are fundamentally different in their makeup! Hydrogen is the element with the highest energy density, but it is also the most finely porous. This means: Hydrogen would still volatilize in existing storage facilities because the porosity, i.e. the ratio of the void volume to the total volume, of the materials is for the most part insufficient in Germany.
Hydrogen is transported and stored in liquid form. Hydrogen is compressed to 700bar and cooled in isolation at -250 degrees Celsius.
This would benefit plant manufacturers such as Sulzer $SUN (+1,96 %) , Voestalpine $VOE (+2,61 %) or Hexagon Composites $HEX (-0,77 %) .
In context, this means that the infrastructure must first be created before we can even think about regenerative hydrogen in the future. In my contribution to Vorwerk $VH2 (+2,17 %) from which I would advise against at the moment, I also explained profiteers of the infrastructure change. For example Vinci $DG (+1,19 %) , Ferrovial $FER , Hochtief $HOT (+4,63 %) or Strabag $STR (+7,39 %) .
Realistically, it will be in Germany only in 20+ years, which for me again does not reflect the current stock market values of the H2 companies.
For the time being, I exclude the adsorption of hydrogen to solid or liquid media. From the current point of view, it does not seem to be a mass solution for the whole society.
10. mobility in individual traffic
The biggest dichotomy, with many still seeing renewable hydrogen in the race, is private individual transport.
The electric car will dominate private households and rightly so! The big disadvantage of the hydrogen car here is efficiency.
While electric cars can use electricity without further conversion and have an efficiency of between 70% and 90%, the form of energy in the hydrogen car must be converted several times.
Here, green hydrogen is produced with the help of electrolysis. For transport, this is compressed and liquefied. Only then is the vehicle refueled. The back reaction of the electrolysis now takes place by means of a fuel cell. An illustration of this can be found in the appendix.
Nevertheless, it is of course up to you to decide which fuel form you will prefer in the future, and this is in no way intended as an appeal to drive an electric car in the future. Compared to other carriers, however, it is the most sensible option in terms of efficiency.
I hereby expressly ask you to note that this is exclusively about the passenger car in this point. For reasons of resource conservation alone, I am in favor of the fuel cell as a drive system for freight transport on roads and railways, as well as in aviation and at sea.
Further energy sources and possibilities of the future power mix I will explain in further contributions.
Of course, if there is also interest, the pro-hydrogen arguments can also be brought to light in further articles. Because these outweigh without question. Nevertheless, the hype, as it is currently traded, is simply unjustified and at least 20 years too early. The stock market may trade the future, but dreaming will be punished.
Planned and already in process is:
- Why it still makes sense to invest in oil and gas producers for 30+ years.
- Waste-to-Fuel - Away with the garbage!
- Regenerative methanol production and the real opportunities for C02 reduction.
(Even today, gasoline and diesel are actually nonsense due to the energy input during production...) And the "argument" of range for BEVs in private transport is also very thin. The average worker in Germany drives less than 50km a day and even a small Renault Zoe would be absolutely sufficient in terms of range.
Friedrich Vorwerk - Watchlist, investment or descending branch?
Dear Getquin'ers,
Due to new circumstances and information, I have changed my opinion on Friedrich Vorwerk contrary to the first post. However, I am still convinced that circumstances will turn around and lead the company to the success it deserves.
Furthermore, I have implemented the questions under the 1st post.
My topic today will be the Friedrich Vorwerk Group $VH2 (+2,17 %) will be. A medium-sized company that will have a decisive influence on the change.
First, a brief overview of the company's history:
No, this is not the household appliance manufacturer of the same name.
Founded in 1962 as "Lohnbaggerbetrieb Kleesch & Vorwerk" and renamed "Friedrich Vorwerk KG" in 1972, the focus at that time was already on underground infrastructure (natural gas and wastewater networks).
Since 2021, the "Friedrich Vorwerk Group" has been listed on the stock exchange in the Prime Standard.
Business segment/business activities:
In an umbrella term, it can be said that the Vorwerk Group is active in plant construction. However, it offers a sensational diversification with shareholdings in various sectors, including road construction (SKS), corrosion protection (Korupp) and many more. The company has a fully integrated and majority-owned value chain, which can offer any solution to the customer.
The business segments are officially declared on the basis of the area of use:
- Natural Gas
- Electricity
- Clean Hydrogen
- Adjacent Opportunities (complex, individual infrastructure projects)
But let us now turn to the most significant items of the business in each case:
1. turnkey solutions
- This includes the all-round package I mentioned for complex infrastructure projects. Friedrich Vorwerk takes on such projects from planning through execution and commissioning to maintenance.
2. engineering
- This area is extremely interesting for industry and utilities and mainly includes project support on behalf of the customer.
3. plant construction and service
- I deliberately combine this point, as it probably reflects the "classic" plant construction most closely. The focus is clearly on electricity, gas and liquid transport, including pump and compressor stations for onward transport, as well as transformers, electrolysers, heat generators, substations, and much more.
Friedrich Vorwerk's business thus covers the entire range of energy transport from the producer to the consumer. I enclose an internal overview. The entire business activity can of course be viewed individually on the website (https://www.friedrich-vorwerk.de/).
Note: The structure on my part does not correspond to the internal structure according to Vorwerk's own company presentation!
Fundamental data:
Here, I orient myself on the basis of the given data up to Q4/22. An overview is attached/edited for publication.
In fact, this is a point to be viewed critically from the current situation. The financials are intrinsically sound and the business is profitable. However, ongoing inflationary pressures and severe supply difficulties are squeezing margins considerably (after Q4/22). Sales of Electricity, Clean Hydrogen and Adj. Opp. divisions are steadily increasing (especially the latter), with the Gas Transmission division stagnating, due to the "green" transformation.
A solid market position is increasingly emerging, particularly in the German market, which will be able to meet the challenges of the future and should benefit strongly from this should.
The order situation continues to be sensational. In fiscal 2022, the number of orders received increased by 146%. The approximate total volume of these orders is in the range of €850 million to €1.1 billion. (as of September 2022). However, further order intakes have already been officially announced.
NEW JAN. 31, 2023:
Following the announcement of the preliminary figures for the full year 2022, the company can still be expected to grow very strongly.
Sales increased by +56% in Q4/22 alone. For the full year, at €368 million, forecasts of €320 million were far exceeded. The margin, on the other hand, is shockingly low. Only 2.6% was generated in Q4/22. Nevertheless, a moderate margin of 9.2% was achieved for the year as a whole.
But how can that be? In revenue-driving projects, a lack of personnel led to deadline pressure. As a result, orders had to be completed with the help of contractors (partner contractors).
Furthermore, the restructuring of the Puhlmann Group is continuing and the defense against a cyberattack led to profitability and visibility problems.
The outlook also leaves much to be desired. For 2023, a lower sales level is already expected in advance. In 2024, on the other hand, there should be a decent boost from projects in the electricity sector.
It remains to be seen.
Share:
Following the announcement of the preliminary figures, we are trending at around €12 per share. A hard correction, but appropriate. MBB sold just under 16% of its shares, 31.01, and now owns just under 36% of the shares. Other well-known investors here are Amundi and Fidelity. Only just under 46% of the shares are now in free circulation.
KGV 22: ~13 KGV 23: ~11 KGV 24: ~9
FCF:
For many members of our community, the free cash flow is sometimes a decisive criterion for an investment.
In 2022, the FCF of € 3.55 million is still very low and thus probably rather deterrent. As early as 2023, however, FCF is expected to rise to over €20 million and continue to increase.
Margin:
A net margin of 9% is the target for the next few years.
Dividend:
0.2€/share was paid in July 2022.
Personal opinion:
Friedrich Vorwerk is a promising beneficiary of the energy transition and has a first-class position in the transport solutions segment. The order situation is good, the finances appear relatively solid with cutbacks in some places. Potential customers here are not only companies but also the public sector, especially within the EU. The pipeline network should offer great order opportunities as the economy restructures (gas/hydrogen). This should have become particularly noticeable after a joint Norway/Germany cooperation in the course of the last visit of our Federal Minister of Economics.
The next big order point will be energy transport solutions for offshore/onshore transport. The expansion of offshore capacity alone to 40 GW by 2040 will generate huge orders to transfer electricity onshore.
My personal target for the stock by the end of 2023 is around €15/share. An entry on my part was made today. (Stop: 8€). Nevertheless, the management should now urgently take care of the known problems of lacking human resources without generating further internal cost pressures themselves. The answer to the question of the headline now therefore: Watchlist.
In the last contribution the question of @TomTurboInvest whether there are not better investment opportunities in this respect. I fully share this view and appreciate at this point once again the profundity of the question. However, if one attaches great importance to diversification, one should certainly keep an eye on Friedrich Vorwerk in the infrastructure sector. I consider a "buy & hold forever" strategy to be less sensible here. The zenith of growth should be priced into the share price between 2030 and 2035. Beyond that, you'll want to settle into the dividend payer portfolio for the long term.
I also see the following as intra-European competitors in the segment: Hochtief $HOT (+4,63 %) , Strabag $STR (+7,39 %) , Vinci $DG (+1,19 %) and Ferrovial $FER . Under certain circumstances, Bilfinger could also be included in this segment. $GBF (+5,82 %)
Conclusion:
I thank you very much for your attention to this point and I hope to have kept a certain simplicity, which could be elaborated if necessary. Please do not hesitate to correct or question me, because this is the only way to get into a discourse.
Thank you very much.
Sources:
https://www.friedrich-vorwerk.de/
Friedrich Vorwerk: Q3/22 quarterly statement + preliminary figures Q4/22.
Chart image: https://www.wallstreet-online.de/
