Infineon, Umicore, Solvay e Faurecia. This the Quartet of Equita’s favorite titles in a report focused on the megatrend of sustainable mobility. A topic that is more topical than ever after the outbreak of the pandemic which had a strong impact on transport and connectivity in the EU, which in turn had repercussions on the entire economy of the Union. The green transition and sustainability are, in fact, the cornerstones of the recovery plan and are in line with the commitment made by EU leaders to build a net-zero carbon economy and society by 2050.
In particular, Equita has decided to increase the estimate for X Electrical Vehicle (xEV) penetration to 24% by 2025 driven by xEV registrations above expectations in the second half 2020-first quarter 2021 synchronized global regulatory support (now also from the USA ), increased OEM (original equipment manufacturer) capex and products focused on clean mobility (now including FCEV).
Sustainable mobility: Equita’s favorite titles
Focusing on the report, the experts of the Milanese SIM have identified the European companies that should benefit most from the transition to sustainable mobility. It’s a matter of Umicore (rating buy) e Johnson Matthey (rating hold), technological leader in materials for batteries and catalysts FCEV (Fuel Cell Electric Vehicle), which, explains Equita, should benefit from stricter regulation of polluting emissions, the electrification of transport and the related recycling of spent batteries, as well as the inflation of the prices of key raw materials for the energy transition.
Then there is the large chip sector with two big Europeans to monitor: the German one Infineon (rating buy) and the Italian-French STM (rating hold) have leading positions in power semiconductors and the automotive vertical accounts for more than 40% and more than 30% of sales, respectively. Also in the Equita team is Valeo (rating hold) is a Tier-1 supplier with exposure to X Electrical Vehicle through its 48-V and Siemens JV offering. Solvay (was promoted to buy) is exposed directly (5% of sales by 2025) and indirectly (15%) to the trend of car electrification. Sim experts have decided to promote it to buy because the 2021 guidance is conservative and the earnings momentum has started earlier than expected.