12. November 2021 | 13:52 CET
NEL, dynaCERT, FuelCell Energy, Plug Power - How far will the hydrogen wave carry us?
The average temperature on Earth should rise by no more than 1.5 degrees Celsius over the next few decades. 190 countries agreed on this target in Paris in 2015. Since then, there have been four further world climate conferences. The fifth is now underway in Glasgow, Scotland, and is scheduled to end today, Nov. 12. It is not only the EU that is tightening its climate targets - around the globe, more and more countries are decarbonizing their economies. The topic of hydrogen is a rainmaker in this context. Here the question arises, when will it really start? According to the World Energy Council (WEC) analysis, at least 20 countries accounting for almost half of global economic output have already adopted a national hydrogen strategy or are at least close to doing so. We take a look at well-known protagonists.
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ISIN: NEL ASA NK-_20 | NO0010081235 , DYNACERT INC. | CA26780A1084 , FUELCELL ENERGY DL-_0001 | US35952H6018 , PLUG POWER INC. DL-_01 | US72919P2020
"[...] Why should a modular electrolyzer cost more than a motorcycle? [...]" Sebastian-Justus Schmidt, CEO and Founder, Enapter AG
Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.
Nel ASA - Is the way clear now?
The share price of the Norwegian hydrogen Company Nel ASA was able to recover on Euronext Oslo in the last 6 weeks from the low reached at NOK 11.89 to the area of NOK 20. At the beginning of November, the price is now faltering at this breakout mark. The most recently reported figures have topped analysts' expectations somewhat, but will this be enough for an 80% rise in the share price?
In the public discussion, the UN Climate Conference has finally brought the topic of hydrogen back into focus. The example of the EU shows how gigantic the prospects are for the Norwegian hydrogen specialist Nel, among others. Europe is planning to expand its green hydrogen electrolysis capacities to a target of 40 gigawatts by 2030. At the moment, the Norwegians can produce electrolyzers with a total capacity of around 40 megawatts per year, which is only one-thousandth of the capacity defined by the EU. Assuming investments are made, Nel could therefore claim a decent share for itself in the future. What it needs now are private initiatives in addition to government research funds.
The Nel share price technically hit its head first at EUR 2.04 and bounced back down to EUR 1.90. This is all still within the scope of a standard consolidation after the substantial rise. Long investors should draw in a stop line of EUR 1.80 to secure profits.
dynaCERT - Tailwind from the climate conference in Glasgow
For dynaCERT shareholders, the climate conference in Glasgow came at precisely the right moment. The share price had been sliding downwards for months on thin news, reaching a low of CAD 0.20 in Canada. But then the counterattack started at the beginning of November. In just 2 trading days, the share price doubled to CAD 0.40. What had happened?
At the start of the conference, dynaCERT was able to come up with two important progress announcements. First, Verra, an international greenhouse gas program management institute, announced that dynaCERT's technology had moved forward an important approval step. Monika Wojcik of Environmental Partners, of the UK, advisor to dynaCERT on carbon credits, commented, "Approval of the new methodology could play an important role in the voluntary carbon market, which could grow from USD 300 million to over USD 550 billion to meet the demand for carbon neutrality in the near future. In the transportation sector, which is not yet represented in the carbon market, the introduction of dynaCERT's HydraGEN Units is a milestone in CO2 reduction, as monetization via certificates can soon be supported for customers."
The conference also kicked off with an important contract signing with Sofina Foods. Through its partner KarbonKleen Inc, Sofina will purchase an additional 16 HydraGEN technology units from dynaCERT to use the patented technology to improve the efficiency of diesel engines and reduce their emissions. dynaCERT also already has the appropriate telematics software onboard, HydraLytica, to officially measure the CO2 savings and document them for the relevant environmental authority. The DYA share thus has solid ground under its feet and can play to its strengths in the round of hydrogen stocks.
FuelCell Energy versus Plug Power - That could be it!
A closer look at the state of the industry is offered by the technical analysis of the billion protagonists FuelCell Energy and Plug Power. Both stocks are analytically elusive, as the price-to-sales ratios of 30 and 22, respectively, based on 2022 revenues, still show the several-year lead time with which these stocks are valued on the stock market.
FuelCell Energy has had a long history of negative cash flows and dilutive capital raises. Plug Power had to clean up balance sheet valuation ratios at the beginning of 2021 and could only regain its footing towards September.
However, both stocks remain unchanged in investors' favor. Like Nel, they were able to ignite a good rally just in time for the climate conference and improved by a full 80% within 6 weeks. The old stock market darling Plug Power was somewhat more dynamic. Now both shares stand, however, at important resistances of EUR 10 and EUR 38. The momentum in both titles tilts now to the right somewhat, and the MACD already gives a short-term sell signal.
FuelCell's stock was able to go back above its 200-day line only a week ago, but it is still tilted downwards. Plug Power has overcome the 200-day line very strongly with 20% and could turn it back up in the next few weeks. In conclusion, both stocks are still fundamentally off their rocker, and momentum is also weakening again. Plug Power can probably hold on a bit longer, but an investment in both stocks is still a hustle.
The hydrogen sector was certainly temporarily a top performer among all future segments of the stock market. Overall, only one Tesla stock has outperformed it at the peak. Companies that can provide a product solution have an analytical advantage because they are already generating tangible sales. dynaCERT produces H2 system solutions, which are now increasingly in demand, and the stock is also starting to attract attention again.