Breaking News
Get 40% Off 0
👀 Reveal Warren Buffett's stock picks that are beating the S&P 500 by +174.3% Get 40% Off

2 US Government-Approved Hydrogen 'Pure Players' That Will Boost Your Portfolio

By Investing.com (David Wagner)Stock MarketsNov 09, 2023 11:52AM ET
www.investing.com/analysis/2-us-governmentapproved-hydrogen-pure-players-that-will-boost-your-portfolio-200643451
2 US Government-Approved Hydrogen 'Pure Players' That Will Boost Your Portfolio
By Investing.com (David Wagner)   |  Nov 09, 2023 11:52AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
 
CVX
+0.93%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
D
-6.11%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
XOM
+1.29%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
ROK
+1.45%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
CL
+2.15%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
NG
-1.88%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
  • Hydrogen is a promising clean energy source
  • The U.S. Department of Energy recently designated companies to receive federal funding for hydrogen development.
  • The two stocks we will discuss in this article are hydrogen 'pure players' set to benefit from it
  • Secure your Black Friday gains with InvestingPro's up to 55% discount!

In a world navigating the shift towards cleaner energies, recent disruptions in fossil fuel markets triggered by the conflict in Ukraine have prompted nations to reassess their reliance on natural gas and oil.

Amid the exploration of various alternative energy sources, hydrogen emerges as a particularly promising yet underdeveloped option. Unlike traditional fuels, hydrogen's combustion leaves no greenhouse gases, producing only water vapor as a byproduct.

However, the challenge lies in its limited availability in easily extractable forms, coupled with the fact that current production methods often involve greenhouse gas emissions, preventing it from achieving economic competitiveness on the scale needed to rival fossil fuels.

US Government Commits to Hydrogen

However, this could change in the years to come. Last month, the US Department of Energy (DoE) designated a number of companies to receive a $7 billion package, a long-awaited announcement of an initiative to accelerate the commercial-scale deployment of clean hydrogen and bring down its cost.

Indeed, the production of clean hydrogen costs around $5 per kilogram, and the U.S. Department of Energy aims to bring the cost of clean hydrogen down to $1 per kilogram over the next decade.

Funded by the Infrastructure Investment and Jobs Act (IIJA), the initiative plans to create seven H2Hubs across the U.S., laying the groundwork for a nationwide network of clean hydrogen producers, consumers and connecting infrastructure. Each hub will include elements of clean hydrogen production, storage, delivery and end-use.

Among the companies that will benefit from the financing are companies with a wide range of profiles, such as major oil companies like Exxon Mobil Corp (NYSE:XOM) or Chevron Corp (NYSE:CVX), but also power companies like Dominion Energy Inc (NYSE:D), or industrial companies like Chemours Co (NYSE:CC) or Rockwell Automation Inc (NYSE:ROK).

However, the financing will also benefit 2 hydrogen "pure players", Plug Power (NASDAQ:PLUG) and Bloom Energy Corp (NYSE:BE).

In the remainder of this article, we'll take a closer look at these two stocks, providing you with more details on their activities and potential, based on InvestingPro data.

1. Plug Power

Plug Power is a pioneer in the hydrogen fuel cell industry. The company has deployed a record 60,000 fuel cell systems for the e-mobility market, is one of the world's largest purchasers of hydrogen, and operates a leading hydrogen refueling network in North America, with over 180 refueling stations.

The company operates an end-to-end green hydrogen network to produce, store, and deliver the fuel in North America and Europe. It plans to produce 2,000 tonnes of green hydrogen per day by 2030. Plug Power's strategy of building the world's first complete green hydrogen ecosystem positions the company as a potential leader.

In terms of financial metrics, according to data available on InvestingPro, the company has experienced strong revenue growth over the past three years:

Plug Power Revenue Trend
Plug Power Revenue Trend


Source : InvestingPro

On the other hand, it is not yet profitable, as evidenced by its latest financial results published on August 9, which revealed a loss per share of $0.35.

Plug Power Last Earnings
Plug Power Last Earnings


Source : InvestingPro

As for the next results, expected this Thursday after market close, consensus forecasts a reduced loss per share of $0.3.

Prochains résultats Plug Power
Prochains résultats Plug Power

Source : InvestingPro

With regard to analysts' targets, the average 12-month target is $14.64, which implies an upside potential of over 107% compared with the current share price.

Plug Power Fair Value
Plug Power Fair Value

Source : InvestingPro

In contrast, InvestingPro models based on financial metrics are more conservative. Indeed, the InvestingPro Fair Value, which in this case synthesizes 6 relevant models, stands at $6.5, just 8% above the current price.

2. Bloom Energy

Bloom Energy has developed the Bloom Energy Server, an electric power generation platform. It has also created the Bloom Electrolyzer, which uses the same solid oxide technology as the Bloom Energy Server, and produces clean hydrogen with 15-45% greater efficiency than other available solutions.

Bloom Energy believes that the Bloom electrolyzer represents a major breakthrough for hydrogen, and would like to make this technology available to heavy industries such as steel, chemicals, cement and glass manufacturing to enable them to decarbonize. In addition, electrolyzers can be connected to solar and wind power to produce green hydrogen, which can be stored and eventually converted back into electricity for later use.

As far as revenue trends are concerned, the trend over the last few years has been largely positive, as can be seen in the graph below from InvestingPro:

Tendance revenus Bloom
Tendance revenus Bloom

Source : InvestingPro

On the other hand, as is the case with PlugPower, profitability has yet to materialize, as shown by the latest published financial results:

Derniers résultats Bloom
Derniers résultats Bloom

Source : InvestingPro

On the other hand, analysts are predicting a clear improvement in the next few results, which should bring the company close to break-even.

Prochains résultats Bloom
Prochains résultats Bloom

Source: InvestingPro

The lack of profitability does not, however, prevent analysts from being optimistic about the stock. Indeed, the average target of the 22 analysts following the stock is $22.59, according to InvestingPro, more than double the current price.

Ojectifs Bloom
Ojectifs Bloom

Source : InvestingPro

It should be noted, however, that Bloom Energy's InvestingPro Fair Value, which synthesizes 12 financial models, is far more conservative. It stands at $10.64, just 6.2% above the current price.

Conclusion

Investing in hydrogen stocks, especially pure players, is clearly a speculative gamble. However, the US government's determination to develop this energy source gives us good reason to hope that the gamble will pay off.

And given that PlugPower and Bloom Energy are the only two "pure players" selected by the US Department of Energy for its pilot project to accelerate the development of this energy source, investors interested in this opportunity would do well to keep these stocks on their radar.

***

Buy or Sell? Get the answer with InvestingPro for Half of the Price This Black Friday!

Timely insights and informed decisions are the keys to maximizing profit potential. This Black Friday, make the smartest investment decision in the market and save up to 55% on InvestingPro subscription plans.

Whether you're a seasoned trader or just starting your investment journey, this offer is designed to equip you with the wisdom needed for more intelligent and profitable trading.

Disclaimer: This article is written for informational purposes only; it does not constitute a solicitation, offer, advice, counsel or recommendation to invest as such it is not intended to incentivize the purchase of assets in any way. I would like to remind you that any type of asset, is evaluated from multiple points of view and is highly risky and therefore, any investment decision and the associated risk remains with the investor.

2 US Government-Approved Hydrogen 'Pure Players' That Will Boost Your Portfolio
 

Related Articles

2 US Government-Approved Hydrogen 'Pure Players' That Will Boost Your Portfolio

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (4)
Donald Schneider
Donald Schneider Feb 14, 2024 11:54AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Thank you, David. I was a Hydrogen development fan long before EV became the frontrunner. It has been so slow to get legs, and I was disappointed for a long time. You state production at $5 per kilogram. Is there any translation of that to compare to bbls of crude and further extrapolating that out to fuel economy, like mpg? That kind of information would be valuable and allow a direct comparative look at fossil fuel, EV, and hydrogen's real cost of operating. Probably EV's greatest advantage is reliability and simple parts swap out for repairs, minus a failed battery which might be reliable anyhow. 6G networks and self-driving are the hurdles, want them or not. I hope it's not Samsung, cuz fighting the typing suggestions while I wrote this really Stinks. Lol
Brizo Brizo
Brizo Brizo Nov 12, 2023 7:39AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
EXCELLENT INFORMATION! THIS NEWS GIVES ME HOPE FOR OUR PLANET AND FOR US HUMAN KIND!
Jou Frank
Jou Frank Nov 10, 2023 7:24PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
✦͙͙͙*͙*❥⃝∗⁎.ʚɞ.⁎∗❥⃝**͙✦͙͙͙Cryptocurrency and binary trade has been one the most profitable online trading and Alot of Investors⊂◉‿◉つ ⊂◉‿◉つ have been benefiting from their trade. with the right strategy attach, 100% rate Kathy gives Her wha''Stp+ / 447 / 4460 / 66295↫↫↫↫↫
Hussein Gholami
Hussein Gholami Nov 09, 2023 3:04PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
trx
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email