Manfred Bender brings a peculiar, shiny, silvery candle with him to the conversation and sets it down on the ashtray.

Nobody needs the tipping grave within the next hour anyway.

Because on this sunny and pleasantly mild August day, no smoking club meets at the table on the terrace of the Bender-run PVA Tepla AG to chat - rather the question is: Why has this medium-sized company based in Wettenberg near Giessen been experiencing a strong boost for months the stock market?

Thorsten Winter

Business editor and internet coordinator in the Rhein-Main-Zeitung.

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A look at the portrait-format company sign in front of the entrance to the headquarters gives a premonition.

It speaks of vacuum and material technology as well as growing crystals, consequently indicates a technology company.

Companies of this type have enjoyed great popularity among investors for many months.

And the guest soon learns from Bender: The candle is not a candle at all, but a material that semiconductors are made of.

And there is a lack of them worldwide.

"The share's upturn has solid reasons"

Within a year, the PVA rate rose from around 14 euros to 36.40 euros and skyrocketed, especially in summer. The all-time high is now a bit out of sight because some investors have taken their profits and sold the paper again. Nevertheless, the statistics show an annual increase of 130 percent. The stock market value has climbed from a good 300 million euros to 650 million euros since August last year. Only a few companies can show such success in the well-running S-Dax small value index and in the technology-heavy TecDax.

"This is an exciting company," says Bender, and immediately adds: "The share price development has solid reasons." The manager is very familiar with technology groups. From 1998 to 2017 he worked for the TecDax-listed Pfeiffer Vacuum AG from Central Hesse, which he most recently managed. After an interlude as CFO of Brain Biotech AG from southern Hesse, he has been the head of PVA Tepla since January of this year. The company was created years ago from the acquisition of Tepla by PVA. The abbreviation stands for Pfeiffer Vacuum Plant Construction. The Mittelhessen parted from this division in 1991, after the merger with Tepla it went public in 1999. In the meantime, a conglomerate of small and medium-sized high-tech companies has emerged, as Bender puts it, with the construction of vacuum systems as the core.

Such systems play an important role in semiconductor production.

And: "A semiconductor is in everything IT is," as the boss explains.

Not to forget cars that have long been bursting with chips.

In front of the semiconductor, however, the peculiar silvery candle, which is actually called a single crystal, arises.

It is pulled in a vacuum using machines from PVA Tepla.

The single crystal brought by Bender measures eight inches in width, that is a little more than 20 centimeters, and a good 30 centimeters in height.

Customers from Central Hesse such as a well-known silicon company from southern Germany pull the single crystal over a length of 4.50 meters.

Then they cut thin slices from it.

The result is a wafer, from which semiconductors such as chips for computers, cell phones and cars are made.

Incoming orders increased sharply

PVA Tepla is therefore at the beginning of a value chain. Now the Central Hesse is not unrivaled. A company in South Korea is doing the same thing, as Bender says. In addition, large customers also built corresponding systems themselves from purchased parts. Regardless of this, the medium-sized group is not only experiencing a strong boost on the stock exchange. In the first half of the year, orders with a total value of 97 million euros were received - more than last year combined, in which the mechanical engineering company had a turnover of 137 million euros. This year sales are expected to increase to between 140 million euros and 150 million euros. The business with systems for quality control should also contribute to this.

In addition, PVA Tepla also manufactures crystal systems with which silicon carbide can be produced.

"This is the stuff that semiconductors for electromobility are made of," emphasizes the boss.

Silicon carbide should make batteries for e-cars and e-bikes more efficient - and both markets are booming.

Last but not least, according to him, Wettenberg is increasing its efforts for systems for wider single crystals.

This would then turn into larger wafers.

The market environment is favorable: Americans, Chinese and Europeans are pushing for the expansion of their own semiconductor production.

Share rated athletically

The valuation of the share can be explained against this background. With a P / E ratio of 65, it's not cheap. The price-to-sales ratio is just under 5. On the other hand, many technology stocks are priced in a sporty way. The bottom line is that the analysts who observe and rate the company are positive. Three of the five advise buyers. In March, Berenberg Bank raised its target price from EUR 15 to EUR 31 and, after the price surge, now regards the stock as a holding position with a target price of EUR 33. The latter also applies to SMC Research. Analysis house Matelan reiterated its buy recommendation in August. The same applies to Jeffries and Hauck & Aufhäuser.