In the high-stakes world of emerging technologies, two UK-based companies are turning heads with their ground-breaking innovations. ITM Power (LSE:ITM) and Oxford Nanopore Technologies (LSE:ONT) are not just pushing boundaries, they’re redefining entire industries. So while many investors look across the pond for exciting investments, let’s dive into why these two UK shares might be the talk of investors for years to come.
ITM Power
First up, ITM Power – the ‘green’ hydrogen specialist. This Sheffield-based company is making an impact in clean energy. Imagine a world where heavy industries and long-haul transportation run on nothing but water vapour.
Its Proton exchange membrane (PEM) electrolysers can split water into hydrogen and oxygen, producing green hydrogen that could just be the lifeblood of a zero-emission future. ITM Power’s product range is ready to fuel everything from buses to steel plants. Of course, ‘ready’ doesn’t mean it’s happening now at scale.
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Revenue is forecast to surge by a whopping 37.79% annually over the next five years. This is the kind of growth that gets me interested. However, it’s not all smooth sailing – the firm is currently in the red and is expected to remain so for the next three years.
The growth is heavily reliant on supportive government policies and subsidies for clean energy. Any changes in political landscapes or reduction in green energy incentives could significantly impact the future of the company.
Oxford Nanopore Technologies
Oxford Nanopore is revolutionising how we read the book of life itself. Its nanopore-based sequencing platforms are like the ultimate speed-readers for DNA and RNA.
Picture a device smaller than a smartphone that can unravel the genetic code of a virus in real-time. From portable DNA devices to lab powerhouses like PromethION, the company hopes to make tech breakthroughs in personalised medicine, epidemiology, and even the search for extraterrestrial life.
The firm’s financial trajectory looks good. With projected annual revenue growth of 20%, it’s on a steady upward climb. But it’s also currently unprofitable. Given the cutting-edge nature of its technology, the company faces potential risks related to patent infringement claims or challenges to existing patents. This could lead to costly legal battles and potential limitations on its product offerings.
But as we’ve seen many times in the biotech sector, today’s research costs often translate to tomorrow’s blockbuster products.
Both have faced their share of market turbulence. ITM Power’s stock took a 15% dip over the past year, while Oxford Nanopore experienced a steeper 55% decline as shareholders were diluted.
Both operate in highly competitive sectors where technological leaps can reshape the landscape overnight. They’re also burning through cash as they race towards profitability. I wouldn’t be surprised at all to see the negative trends continue for the shares, but investing is a long-term game, and requires patience.
Worth a closer look
Both ITM Power and Oxford Nanopore Technologies represent two of the UK’s most exciting technological prospects. They’re not just businesses; they’re visionaries crafting the future of energy and biotechnology. One of my favourite parts of investing is finding companies that offer a tantalising glimpse into what the future might hold, and these two tick all the boxes.
While these two sparkle with potential, unprofitable companies in the growth stage have plenty of risks too, so I’ll be cautiously adding them to my watchlist.
