Value Column von Hans Peter Schupp
28 March 2025
Energy Plus
Hans Peter Schupp, CEO of Fidecum AG and portfolio manager of the Contrarian Value Euroland Fund (ISIN: LU0370217092), on investing in the energy of today and tomorrow.
The global demand for energy continues to grow, CO2 emissions are rising and the climate is changing noticeably. The solution seems to require a technological revolution.
Back in ancient times, Prometheus was said to have brought fire to mankind. Today, scientists are working on developing an equally groundbreaking source of energy in the form of nuclear fusion. Their goal: to generate virtually unlimited, climate-neutral and economically viable energy – a project that could fundamentally change the energy supply of the future.
Nuclear fusion has been taking place inside the sun for billions of years. There, hydrogen nuclei fuse to form helium, releasing huge amounts of energy in the process. If this principle can be harnessed on Earth, even small amounts of hydrogen could be enough to supply entire cities with electricity for months – without CO2 emissions or radioactive waste.
But, this is still only a vision. One of the biggest challenges is the required temperature: the atomic nuclei only fuse at 100 to 150 million degrees Celsius. Keeping such a plasma stable in a reactor and making efficient use of the energy generated in the process are still unresolved technical issues. However, advances in materials research, magnetic field technology and artificial intelligence offer hope.
Nuclear fusion: an energy source of the future?
The first successes have already been achieved: in 2022, scientists succeeded for the first time in generating more energy from fusion than they had put in – albeit only for a tiny moment. However, this progress marks a decisive step on the way to commercial use.
If a commercially viable fusion power plant can be developed, this would not only have far-reaching consequences for the global energy supply, but also for investors. While many research projects are state-funded or not listed on the stock exchange, there are still opportunities to position yourself indirectly – for example via ENI (ISIN: IT0003132476).
Why ENI?
The Italian energy company is not only involved in conventional energy production, but is also the largest shareholder in Commonwealth Fusion Systems (CFS) – a promising start-up that is working on the development of a market-ready fusion reactor.
However, we like ENI not only because of its vision for the energy of tomorrow, but above all because the company is very successful in producing the energy of today. The company is also taking an unusual approach to oil and gas exploration. Instead of relying on traditional partnerships, ENI invests specifically in its own research and analysis in order to identify the most profitable deposits. Only then are partners brought in for production – a strategy that not only saves costs, but also brings strategic advantages.
Above all, however, the company’s shares are attractively valued. The price/earnings ratio is below 10 and the dividend is rising steadily – with the exception of the crisis year 2020. The dividend yield is above seven percent.
In this context, the prospect of a possible success of nuclear fusion is something like a free option on the future of energy for us. We are happy to take it as an addition to an investment in an already attractive company.
Our investment approach
With our Contrarian Value Euroland Fund (ISIN: LU0370217092), we have remained model consistent for 25 years. We invest in undervalued companies with a viable business potential and a comprehensible business model. In doing so, we act like an entrepreneur who wants to buy the entire company and – if necessary – deliberately go against the prevailing market opinion.
About the author: Hans Peter Schupp, managing partner of Fidecum AG and portfolio manager of the Contrarian Value Euroland Fund.
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