February 18th, 2022 | 09:42 CET
Nel ASA, First Hydrogen, Plug Power - Hydrogen facing new hype?
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"[...] We can convert buses and trucks to be completely climate neutral. In doing so, we take a modular and incremental approach. That means we can work with all current vehicle types and respond to new technology and innovation [...]" Dirk Graszt, CEO, Clean Logistics SE
Nel ASA - Strong order intake
Nel ASA is based in Norway and provides solutions for the production, storage and distribution of hydrogen produced from electrical energy, preferably renewables. The Company operates worldwide and covers the entire value chain in hydrogen technology. It is particularly well-positioned in Scandinavia, where it is a leader in green steel. Heavy industry, in particular, is dependent on energy. Here, green hydrogen could be an alternative in the future.
On February 16, the Company presented its figures for the fourth quarter. Order intake was a positive surprise, rising by 43% to EUR 41.3 million. The order backlog also increased by 25% YOY to EUR 121.6 million. Apart from that, the quarterly figures were disappointing. Sales increased by only 8% to EUR 24.5 million. On the other hand, the EBITDA loss increased by 75% to EUR 16.6 million. The net loss of EUR 26.6 million was thus even higher than sales. The cash balance stands at EUR 269 million. According to the Company, the high losses are due to the expansion of production and 114 new employees.
While JPMorgan gave the stock an "underweight" rating and a price target of EUR 0.99 after the figures, other analysts were much more positive as demand for hydrogen technology is growing. The analyst firms Jeffries, Goldman Sachs and RBC, see the stock as a buy with price targets between EUR 1.68 and EUR 2.27. The share is currently trading at EUR 1.28 and this time did not react with large price swings after the figures. The market capitalization is still high at EUR 1.87 billion.
First Hydrogen - Expansion of business areas
First Hydrogen is based in Vancouver and has set its sights on becoming the leading manufacturer of zero-emission hydrogen-powered commercial vehicles in Europe and North America. This is to be achieved through a best-of approach. The Company has proven that this works with a first demo vehicle. A MAN eTGE served as the platform, Ballard provided the drive, and AVL Powertrain was responsible for the design. The design of the first vehicle was completed within a few days. By the end of April, the planning and designs for the pilot vehicles should be completed. Delivery is planned for the third quarter of 2022.
While the commercialization of the vehicles is running at full speed, the Company was able to win FEV Consulting GmbH as another partner for the expansion of the business areas. Together with the Aachen-based Company, state-of-the-art hydrogen refueling stations are developed. For this purpose, the wholly-owned subsidiary NetzeroH2 Inc. was founded, which will be responsible for the production and launch of the filling stations, the Company announced on January 11. For customers who purchase the commercial vehicles, it is ideal that they can also directly order hydrogen refueling stations and thus receive everything from a single source. It also creates cross-selling opportunities.
Since mid-January, the management team has been significantly strengthened. First up was Steve Gill, appointed Director of First Hydrogen UK Limited and Chief Executive Officer of the automotive division. He draws on 19 years of experience at Ford Motors. Robert Campbell, senior vice-president and chief commercial officer of Ballard, became a non-executive director of First Hydrogen UK Limited. Nicholas Wrigley joined the team at the end of January as Chairman and Director of First Hydrogen UK Limited. Over the next 5 years, the Company will conduct joint research with Cambridge University on hydrogen technologies focusing on the automotive industry. The stock is currently trading at 2.38 Canadian dollars (CAD), giving it a market capitalization of around CAD 131 million, which is considered cheap compared to its peers.
Plug Power - Raising the annual forecast
Plug Power operates globally, providing turnkey hydrogen fuel cell solutions to its customers. With more than 50,000 fuel cell systems for electromobility delivered, the Company is the top dog in the hydrogen sector. The product portfolio is modular and offers customers rapid refueling and, above all, environmental benefits. Ultimately, almost all companies want to become climate-neutral in the future.
So far this year, the Company has been very quiet. On January 19, management gave an outlook for the coming year, raising sales expectations. That was a positive surprise for analysts. For the current year, sales are expected to be between USD 900 and 925 million. Thus, the major target of USD 1 billion will probably still be missed this year. The gross margin is expected to be 30% in 2025. The Company reaffirmed this. A total of 155 megawatts of hydrogen electrolyzers are to be delivered this year.
Like all hydrogen companies, the market leader is not in the black as it invests in the future. The stock has been sold off since November 19, losing 60% of its value at its peak. The support from May 2021 at USD 18.47 was tested and held. Currently, the stock is trading at USD 23.90. Thus, the share has formed a first small upward trend. The market capitalization amounts to a good USD 13.8 billion. If you want to invest in the industry leader, Plug Power is the right place to go.
There are initial signs that the situation on the hydrogen market is clearing up. Nel ASA is booking significantly more orders but is still far from being in the black. First Hydrogen is doing very well with its best-of approach and is comparatively cheaply valued. Plug Power is and remains the benchmark in the hydrogen sector and offers an attractive entry opportunity after the 60% correction.
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