Shares in UK electrolysis specialist ITM Power have corrected sharply over the past few weeks. At its peak, speculative title fell by about 50 percent. According to analysts at private bank Berenberg, the current price level presents an interesting entry opportunity.
• Berenberg raises price target
• The deal with Rheinmetall will be a game changer for ITM Power
• Failures as an opportunity to buy
On Tuesday, Berenberg significantly increased the fair price of ITM Power shares from 110 to 200 British pence (2.32 euros), the recommendation remains “Buy”.
Analyst Alex Smith highlights the potential of the deal with Rheinmetall. “As ITM Power pioneers new end markets, we will take another look at the significant growth opportunities presented by the company’s partnership with Rheinmetall on the Giga-PtX project,” Smith said.
The partnership with Rheinmetall is largely focused on a different use case than other traditional green hydrogen markets, with a focus on military energy security rather than net zero or decarbonization goals, explains Berenberg’s expert.
“ITM opens up new markets and different use cases for green hydrogen. “Further diversification of potential tender channels and clients opens up additional growth opportunities,” adds Smith.
After DER AKTIONÄR advised taking first profits at a price of a good 2.20 euros, speculative investors can now start building up positions again. The medium to long term prospects for electrolysis specialists remain good. A stop at €1.15 secures the position.
Frequently asked questions:
What does UK ITM Power actually do?
ITM Power is developing electrolysers, that is, systems that can produce hydrogen from (green) electricity.
Is ITM Power more of a growth stock or a speculative stock?
Both. The business has huge potential, but the stock is also highly dependent on orders, industry sentiment and capital needs.
Is ITM Power profitable?
No. Like many other hydrogen companies, the current focus is on gaining market share and, in particular, technological leadership.