| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 0.90 | -88 |
| Intrinsic value (DCF) | 9.44 | 21 |
| Graham-Dodd Method | 0.30 | -96 |
| Graham Formula | n/a |
Hexagon Composites ASA is a Norway-based leader in composite pressure cylinders and clean fuel solutions, serving diverse markets globally. The company operates through four key segments: Hexagon Agility & CNG LDV (providing clean fuel solutions for commercial and passenger vehicles), Hexagon Purus (specializing in high-pressure cylinders and battery systems for fuel cell and electric vehicles), Hexagon Digital Wave (offering advanced cylinder testing and monitoring technologies), and Hexagon Ragasco LPG (manufacturing composite LPG cylinders for leisure, household, and industrial use). With a strong presence in Europe, North America, and emerging markets, Hexagon Composites is at the forefront of sustainable energy transition, leveraging lightweight composite technology to reduce carbon emissions. Headquartered in Ålesund, Norway, the company has been a pioneer in composite solutions since 1985, positioning itself as a critical enabler of the hydrogen economy and alternative fuel adoption.
Hexagon Composites presents a high-risk, high-reward proposition tied to the global energy transition. The company's negative net income (NOK -215M in latest reporting) and significant debt (NOK 1.89B) raise concerns about near-term profitability, though its NOK 4.87B revenue base demonstrates substantial market traction. The stock's beta of 1.279 indicates higher volatility than the market. Key attractions include leadership in hydrogen storage solutions through Hexagon Purus and growing demand for CNG/LNG fuel systems in commercial transport. However, investors must weigh the long-term potential of hydrogen infrastructure against current financial challenges and the capital-intensive nature of composite manufacturing. The lack of dividends reflects reinvestment needs in this growth phase.
Hexagon Composites occupies a unique position at the intersection of composite materials engineering and clean energy systems. Its primary competitive advantage lies in proprietary filament-winding technology for Type IV composite pressure vessels, which offer superior weight savings and corrosion resistance versus traditional metal cylinders. In hydrogen mobility, Hexagon Purus competes with established players through vertically integrated systems combining tanks, battery packs, and vehicle integration expertise. The Agility segment benefits from first-mover advantage in North American CNG fuel systems for heavy trucks. However, the company faces pricing pressure from Asian manufacturers in standard LPG cylinders (Ragasco segment). Hexagon Digital Wave's non-destructive testing technology creates a sticky revenue stream through patented acoustic resonance technology. The main challenges include scaling production to achieve economies of scale while maintaining the premium quality that justifies higher price points versus steel tank alternatives. The company's Norwegian R&D base provides access to Europe's stringent certification standards, creating barriers to entry in regulated transport applications.