Frankfurt That was fast. It was only in September that Siemens went public with its power technology subsidiary Siemens Energy, and in three weeks it will be included in the MDax of the 60 largest German medium-sized companies. Deutsche Börse announced this on Thursday evening after the US market closed.
Analysts had anticipated the rise of Siemens Energy. With a market capitalization of 16 billion euros, Siemens Energy was the largest spin-off of a part of the company in Germany. After a disappointing first few weeks of trading, the share is now at EUR 24.50 – eleven percent above the starting price of EUR 22.01.
There are no changes in the leading index Dax and in the technology index TecDax this month. But there are more changes in the SDax than seldom – even though the stock exchange only exchanges those values in all indices in December that are particularly good or bad in terms of market value or stock exchange turnover.
So far, the stock exchange decides on the promotion and relegation in the indices on the basis of the criteria of market capitalization of the freely traded shares and the average stock exchange turnover. It was therefore clear to analysts since the IPO that Siemens Energy would move into the MDax.
Even more: the Siemens subsidiary is a candidate for the leading index Dax next year, which Deutsche Börse will expand from 30 to 40 companies in September. In return, the MDax is reduced by ten to only 50 values.
Siemens Energy offers a wide range of energy technology, from energy generation with conventional power plants and renewable energies to energy transmission. In the past fiscal year, which ended in September, the group posted a loss of just under 1.9 billion euros due to special depreciation and the corona crisis.
However, analysts believe in the turnaround and advise the majority to buy the share – also because of the prospect of a rise in the Dax.
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The leasing provider Grenke, whose share has plummeted by 30 percent since mid-September alone, has to give way for Siemens Energy. The British financial investor Fraser Perring had accused Grenke of fraud, money laundering and balance sheet falsification – and at the same time bet on a crash of the shares.
Grenke countered with a shift in strategy and wants to integrate the franchise business that is the focus of the Fraser-Perring allegations. That helped the share only partially. That is why Grenke is the weakest MDax member and is relegated to the SDax of the 70 smaller companies.
Aareal Bank, which was also considered a relegation candidate and only barely retained its MDax place in September, managed to stay up in the most important German second-tier index.
Seven SDax relegated members, six promoted members
Seven companies from different industries have to switch from the SDax. For Grenke, the cable operator Telecolumbus has dropped out of the SDax. The auto supplier Leoni is falling, as is the financial group Wüstenrot & Württembergische (W&V), the UV specialist Dr. Hönle, the machine tool manufacturer DMG Mori, the IT security service provider Secunet and WashTex, a manufacturer of vehicle washing systems.
With the online broker Flatex Degiro, the online furniture retailer Home24 and Westwing, three companies from the online world are among the six SDax promoters. In addition, the biofuel manufacturer Verbio, the armaments electronics manufacturer Hensoldt and the automotive supplier Elring Klinger are promoted to the SDax.
These are the six SDax climbers at a glance:
SDax newcomer Flatex Degiro
Flatex Degiro benefits from the volatile stock exchanges. Because of the Flatex takeover of Degiro, the online broker was able to almost double its turnover in the first nine months of almost 165 million. Flatex was already profitable before the Degiro takeover.
Analyst Frederik Jarchow from the private bank Hauck & Aufhäuser assumes that the high price fluctuations will continue to drive customers’ trading activities. Like all the other six analysts who watch the stock, Jarchow also advises buying the stock. This year the share price has already risen 125 percent.
SDax newcomers Home 24 and Westwing
The shares of Home 24 and Westwing have gained even more as corona profiteers. Home24’s share has risen 285 percent since January, and Westwing’s even 750 percent. Both stocks have already recovered from their brief price losses at the beginning of November after the first news about successes in vaccine development against the coronavirus.
The news raised hopes of an foreseeable end to the pandemic and sent many shares of companies whose business was particularly booming in Corona times to the basement. So far, Home24 and Westwing have only been covered by a few banks, but they all recommend buying.
SDax climber Hensoldt
Analysts also see the opportunities for defense electronics manufacturer Hensoldt as positive, although the share has so far disappointed investors. Hensoldt only went public in September at an issue price of twelve euros and is now only slightly higher.
Hensoldt, however, could benefit from the federal government’s planned investments in defense technology. The Bundestag has already approved orders for 1.9 billion euros. At Hensoldt, too, the recommendations of analysts are all: Buy.
SDax climber Verbio
Analysts at the biofuel manufacturer Verbio are also unanimous and recommend buying. Verbio reported a record result in the broken financial year that has already ended. Above all, the company benefited from the fact that it quickly expanded production this year to include disinfectants. Since the beginning of the year, the share has already gained more than 130 percent.
SDax climber Elring Klinger
The auto parts supplier’s share has risen 275 percent since its low in March. The rally can be traced back to several collaborations in hydrogen technology. The majority of analysts are currently skeptical. Out of ten experts, only two recommend buying, three holding and five selling. The average target price is currently around five euros below the current rate of 13.54 euros.
More: Ten European stocks with up to 60 percent price potential.