Why fuel cell stocks are booming again today

What happened

Hydrogen fuel cell stocks rise Tuesday, the first day of trading after the US Department of Energy (DOE) made a big announcement that promises to help grow the hydrogen economy in the to come up.

Until 12:30 p.m. EST:

• Bloom Energy (NYSE: BE) stocks climbed 7.1%;
• Connect the power (NASDAQ: PLUG) gained 8.5%;
• Ballard Power Systems (NASDAQ: BLDP) the stock is up 8.7%; and
• FuelCell Energy (NASDAQ: FCEL) leads the whole peloton up – + 9.1%.

So what

Three factors appear to be at play today: analyst upgrades, the DOE announcement, and earnings. Let’s take them one at a time.

Ballard Power is one of the biggest fuel cell winners today, and for good reason. This morning, BMO Capital analysts said they launched a Ballard cover with a buy rating and a price target of $ 39, StreetInsider.com reports.

Plug may be the fuel cell company that has dominated all the headlines lately, but about 45% of fuel cell vehicles in circulation in China today are working. Ballard Power fuel cells, BMO note. Eighty percent of fuel cell buses in Europe are also Ballard-type, as are 95% of fuel cell buses in California. BMO believes that Ballard’s “industry-recognized sustainability” and technical expertise will prove to be “competitive advantages” in the future as Ballard prepares for the potential rapid growth of the emerging heavy-duty battery-powered truck market. fuel over the next two or three months. years.”

And speaking of growth, the DOE gave the fuel cell industry a big boost towards its growth targets on Friday by announcing $ 160 million in grants to fund “production, transportation, storage and transportation. ‘use of hydrogen of fossil origin “. Although this appears to be at odds with initiatives such as the Plug Power project to produce “green hydrogen” (i.e. hydrogen separated from water through electricity produced from solar and wind energy), silverand free government money can only be good news for fuel cell stocks.

Now what

How well will things go, with the US government putting its weight – and its checkbook – behind the fuel cell industry?

We’ll have our final look at how fuel cell companies are doing on Wednesday, when FuelCell Energy releases its fourth quarter and full year 2020 financial results before the market opens. Analysts will look for a 54% increase in FuelCell sales and a decrease in net loss ($ 0.04 per share – check back Thursday to see how it works).

Then we will take a break for a few weeks, until Bloom Energy reports his Fourth quarter results on February 10, followed a few weeks later by the Plug Power report on March 3. Ballard has yet to announce a date for its results, but as it announced in early March of last year, it’s a safe bet that the fourth quarter of 2020 results will be released again in March 2021.

For what it’s worth, no analyst predicts that all of these companies will actually report earning anything on “income” days. Bloom Energy is expected to come the closest, however, with breakeven earnings expected on a 5% gain in sales.

Crossed fingers.