SFC Energy AG (ETR:F3C), Germany”s 9th largest energy company by market capitalisation, extended its slide Thursday, shedding an additional 5.40c (or 1.2%) to close at EUR4.46.
The company makes “smart” fuel cells and specialises in the off-grid market. The shares have plummeted EUR1.01 (or 18.5%) over the past seven trading days, due to declining profit margins.
But the fundamentals are largely positive making this stock a buy, especially if the price falls further, which is highly likely to happen. Compared with the DAX Index which fell 223.9 points (or 2.72%) in the seven days, this represented a relative price change of -15.8%.
The company is cash rich with Cash to Market Capitalisation at 67.7%. Current assets are 4.4 times current liabilities.
The Q Ratio, defined by James Tobin as MCap divided by Total Assets, is 0.7. Compared with the rest of the market the stock is undervalued.
The average length of ownership of the stock at 7.2 times the average holding period of 7 months for stocks in the DAX Index suggests a larger number of core investors, making a long-term investment safer.
A recent report from offgridnet.staging.wpengine.com on Europe’s Fuel Cell Market defines and segments the European fuel cell market with analysis and forecast of the revenue. The fuel cell market will grow from an estimated $147.1 million in 2013 to $630.9 million by 2018, at a compound annual growth rate of 34.0% from 2013 to 2018
The author has no investment in SFC – nor any connection with them.