June 24th, 2021 | 11:59 CEST
Plug Power, NEL, Pure Extraction: Hydrogen on hold - here is what's next
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"[...] We are committed to stay as the number one Canadian and global leader in the Hydrogen-On-Demand diesel technology [...]" Jim Payne, CEO, dynaCERT Inc.
At home in Southern Germany, the passionate stock exchange expert has been accompanying the capital markets for about twenty years. With a soft spot for smaller companies, he is constantly on the lookout for exciting investment stories.
Plug Power: Attention, a flash in the pan!
The US company Plug Power recently published figures. Sales of USD 72 million were above expectations, but the Company also made more losses. At 12 cents per share, the Company is in the red. The fuel cell specialist focuses on distributed power and fleet vehicles and is considered one of the hottest hydrogen companies in the world. But the latest losses show that the market situation for hydrogen companies is not exactly rosy. Above all, the already very ambitious valuation is a cause for concern: Plug Power's shares are currently worth around EUR 17 billion on the stock market. Even given the growing competition, this is too much.
Although the share price jumped in the wake of the figures, the results are by no means a glorious achievement. It is doubtful whether the stock will overcome the various technical resistances and return to better waters. Beyond the EUR 30.54 mark, investors can gain more hope on a closing price basis. Until then, selling pressure threatens.
NEL: Comeback share without a comeback
The NEL share has also experienced selling pressure. The Norwegian hydrogen specialist has been considered a comeback stock for weeks; however, the share price is still not gaining momentum. After the stock had achieved prices above the EUR 3 mark, the sell-off set in at the beginning of 2021. The share price fell in several waves. Above EUR 1.60, the share seems to have found a bottom, but there has been no real rebound so far - which can be interpreted as a warning signal. The share is currently worth EUR 2.6 billion - a fair value given the relatively manageable figures and a great deal of future fantasy. So the air is out of NEL for the time being.
Even if shares like Plug Power or NEL do not seem very interesting at the moment, new conditions on the market, such as government subsidies or a technological breakthrough, could boost the values again. Shares in the hydrogen sector are driven primarily by a good deal of future fantasy. If this returns, the share prices can also accelerate again.
Pure Extraction becomes First Hydrogen
One hydrogen stock that is still in its infancy is Pure Extraction. The Company is already planning to change its name in a few weeks and will be called First Hydrogen. Although the stock still has a different name, work is already underway behind the scenes to shape the Company's future. First Hydrogen wants to put hydrogen-based vans on the road and has already gained two partners in Ballard Power and AVL. First Hydrogen is convinced that the global market for fuel cells will grow by more than 20% per year over the next few years. In particular, delivery services, for which small commercial vehicles have so far been used, could be put on the road in a climate-neutral and cost-effective manner thanks to hydrogen technology.
Compared to electric vehicles with lithium-ion batteries, the Company promises greater efficiency and ranges between 400 and 600 kilometers. With a capital investment of EUR 2 million, a prototype is to be created to bring investors and customers closer to the benefits of the approach. The first steps towards commercial production are then to be taken in the fall of this year. First Hydrogen will rely on established suppliers. The share is currently valued at around EUR 87 million. Although the Company is still in its infancy, it is clear where First Hydrogen's journey could lead. Numerous delivery services and parcel delivery companies are currently working on their ESG profile. If the advantages over e-cars catch on, First Hydrogen could strike a chord with potential customers.
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