Publication date: May. 15 2024

Alfen: buy the dip!

Alfen has become known to the general public as a specialist in charging stations for electric cars. Founded in 1937, the company offers much more than just the well-known charging stations with its total solutions for energy issues. Since 2018, Alfen shares have been listed on the Amsterdam stock exchange and are part of the Midkap index.

The course of the share price since 2018 has been nothing short of spectacular. Below is the chart.

What is immediately noticeable is the fantastic rise from €10 to €90 in the early years of the listing.
Then a very erratic period that finally led to the highest level at €120.
The subsequent fall to €28 will not soon be forgotten by many investors. The relatively modest price movement since November 2023 still has ups and downs from € 28 to € 65 and back again to € 32. Therefore, this stock offers excitement with its risks, while also presenting promising potential for investors.
Reason enough to inform you further and determine what Alfen can bring to the portfolio.

Price development: analysis and trends

To form an assessment of the future trajectory of the share price, our analysis delves into the events of the preceding two years. The big drop with then the moving period since the summer of 2023.

Alfen is a capital-intensive company. This is exemplary of companies in the energy sector. In addition, Alfen invests heavily in development and innovation. This requires a lot of capital, which is partly externally financed. Once the interest rate rises above a certain limit, the interest expenses start to have a major impact on the profitability of the company. 

We can see this directly in the graph below.

In the graph above, Alfen is a company that invests a lot in development and innovation.

The chart above shows Alfen's price movement compared to interest rate movements. In this case, interest rates in the US. The intersecting blue lines signify the moment when Alfen's share price peaked, coinciding with a projected increase in interest rates from 2.2% to the current rate of 5.5%. This immediately shows the influence of rising interest rates on Alfen's share price.

We see this as the biggest influence on the share price. There is also increasing competition but that influence is not expected to be as strong on the share price.