05. December 2019 | 13:14 CET
Ballard Power, NEL ASA, Plug Power - and where real money is made today
The change in mobility is one of the most challenging issues of our time. German carmakers are currently focusing on the launch of battery cars in order to meet the increasingly stringent exhaust emission requirements of the European Union. From the user's point of view, electric mobility based on batteries and the idea of several million charging points at the roadsides and parking lots are reminiscent of the days of horse-drawn carriages. But this comparison is not accurate, because horses have not caused environmental damage in other parts of the world. In Germany there is an established network of over 14,000 gas stations and it is no secret that hydrogen takes about the same time to fill up as combustion engines. Why not the hydrogen car now?
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ISIN: NO0010081235 , US72919P2020 , CA0585861085
"[...] When we acquire something, we want to make sure that the acquisition fits with our strategy and has the potential to be successful for our shareholders. [...]" John Jeffrey, CEO, Saturn Oil & Gas Inc.
Demand determines supply
The hydrogen industry consists of different market participants. On the one hand, manufacturers of plants are needed with which hydrogen can be produced. These plant or machine manufacturers need a planning-safe market, i.e. if the trend is towards mobility based on hydrogen, then there will be demand for such plants and the developers and manufacturers will find buyers for their equipment. However, hydrogen alone is not enough to drive a car, because fuel cells are needed to convert the energy of hydrogen into electricity for the electric drive motors. Everything sounds quite simple.
Political and strategic omissions
Even the refueling process is as simple and fast as the users are used to from conventional petrol and diesel fuels - as are the engine performance and range. Theoretically, an energy revolution in mobility would work silently. Manufacturers would only have to follow the price/performance level of vehicles with internal combustion engines and set up a network of hydrogen stations.
However, political and entrepreneurial failures on the part of car manufacturers have led to costly bets being placed on the wrong horse for the time being. Under the pretence of climate protection, lithium and cobalt production in developing countries is sustainably damaging the environment in order to produce batteries for climate protection in the rich industrial nations. Sounds bizarre and absurd.
In the end the buyer decides
It remains to be seen how long the story of the climate-friendly battery car will be spread in elaborate marketing campaigns. It remains to be hoped that buyers will continue to strike and simply drive their vehicles longer until an attractive range of fuel cell vehicles is available. Anyone wishing to position themselves as an investor in the hydrogen sector among suppliers must currently accept a relatively high valuation.
High investment demand
Ballard Power is valued at EUR 5.95 on the stock exchange at EUR 1.4 billion. In the first nine months of this year, Ballard Power recorded a slight decline in sales from USD 68.1 million to USD 64.4 million, with losses increasing from USD 15.9 million to USD 28.8 million. At a share price of EUR 0.73, NEL ASA is valued at around EUR 890 million. In the first nine months, the company increased sales from EUR 36.4 million in the previous year to EUR 39.4 million, but at the same time increased its loss from EUR 13.4 million to EUR 17.7 million.
Long staying power is necessary
At a share price of EUR 2.93, the company Power Plug is valued at around EUR 750 million. In the first nine months of this year, sales rose from USD 114.8 million in the previous year to USD 132.0 million. The bottom line was that the loss in the same period of the previous year increased from USD 61.3 million to USD 73.8 million. Assuming that mobility will only move in the direction of hydrogen on a large scale in the next five to ten years, it may also be worthwhile at present to look around the established energy sector with bargains.
Traditional entry month December
The month of December has traditionally been a popular time window for international investors in Canada, as profit-taking and the realisation of tax losses often lead to falling prices at the end of the year, which then rise again in the new year. Last week, a growing Canadian oil company published its figures for the first nine months of the year and increased sales from CAD 3.1 million to CAD 13.8 million compared to the previous year.
Last year, the company recorded a slight loss of CAD 0.1 million, but in the same period this year it generated a profit of CAD 2.3 million. The company was founded in 2017 as part of a realignment with new management and has been on the road to success ever since.
Low valuation, high potential
With a profitability of over 16.6%, the company is one of the most profitable energy producers. With a share price of EUR 0.085, the company is valued at around EUR 20 million on the stock exchange. In November 2019, the German GBC AG published a research report on the company and a BUY rating with a price target of 0.21 EUR .
'Profitable oil producer with significant growth potential' is the title of the study and the company's name is Saturn Oil & Gas Inc.