Without cooling, nothing runs in IT: Where opportunities await.

Last Updated: 4. Dezember 2023By

Investments in Artificial Intelligence and E-Mobility are trending. The stocks of companies in this sector are mostly highly valued, so the investment comes at a price.
Those who want to benefit from the hype with more affordable investment options should look beyond the horizon and consider companies that perform important tasks in the background. This includes, for example, cooling the servers of the tech giants.
A big order from the US: Is Technotrans now taking off? There is even a cooling specialist for modern technology in Germany, more precisely Technotrans (WKN: A0XYGA) from Sassenberg between Bielefeld and Münster. According to its own statements, the company has just received a large order for the series production of energy-efficient cooling systems for high-performance servers. Delivery of the cooling systems for the high-performance servers of a US company is expected to begin in early 2024. The order starts in a single-digit million range, but the order volume is expected to double in the following year and increase further in the following period. Technotrans is considered an interesting partner because its solution is based on direct liquid cooling, which works particularly energy-efficiently and thus effectively reduces the CO2 footprint of the data centers.

The US order falls into the Energy Management segment, which accounts for 7% of Technotran’s consolidated sales. That’s 16 million euros.

On the move in future areas, growth and additional sales are also promised by Technotrans cooling solutions from electric car charging stations. Since charging stations for electric cars should be further expanded in Germany, there could be one or the other order coming up in this area.

The main business of Technotrans is currently still in the print sector. Here it is about cooling printing machines. Due to the bad economic development and the increased inflation rate, Technotrans issued a profit warning for the current year in summer. This put the stock under strong pressure. Since the beginning of the year, the stock is down more than 20 percent.

A cheaper entry point The company’s market value of 135 million euros corresponds to about 16 times the expected profit. According to estimates, however, the P/E ratio could be only 10 in 2025, as sales are expected to grow by 11 percent in the current year.

After the cooperation with the US company was announced, the share price turned and has been rising since then. In addition, investors benefit from dividend payments. The dividend yield is currently 3.4 percent.

The big order from the US could be a gamechanger for Technotrans, but the company is still a small light from Germany. That means: An investment is risky.

If you like risky investments, however, a look could be worthwhile. The entry point could be just right to take big chances of profit. Decide for yourself whether the stock would be something for your portfolio.