June 14th, 2022 | 13:35 CEST
The stock markets are on fire! What is next for Nio, First Hydrogen and Nel ASA?
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"[...] Why should a modular electrolyzer cost more than a motorcycle? [...]" Sebastian-Justus Schmidt, CEO and Founder, Enapter AG
The native Franconian has more than 20 years of stock exchange experience and a broadly diversified network.
He is passionate about analyzing a wide variety of business models and investigating new trends.
Further trouble looms at Nel ASA
The need for renewable energies is more important than ever after Russia's invasion. Creating independence from Russian oil and gas is currently the goal of Western politicians, no matter the cost. Using "freedom energies" with wind, sun and water, the transformation away from fossil fuels should succeed. Hydrogen and fuel cells play an essential role here. When the subject of hydrogen comes up on the stock exchange, the name of hydrogen specialist Nel ASA inevitably comes to mind. The Norwegians are the European market leader and one of the pioneers in electrolysis technology.
Thus, Nel ASA was also inevitably one of the stock market stars in 2020. Since the Corona low in March 2020, the stock more than quadrupled from EUR 0.80 to EUR 3.40. Since then, Nel, which had a stock market value of more than EUR 5 billion at its peak, has been on a steep downward trend. An interim low of EUR 1.10 was not reached until May of the current stock market year. A further slide into the penny-stock range was averted for the time being. Thus, the stock rose to the vertical resistance area at EUR 1.48 before a renewed sell-off took place under high volumes. Currently, Nel is trading at EUR 1.19. Again, the title is in danger of marking a new low for the year. The trend-following indicator MACD gave a new sell signal just today, so a slide into the penny range does not seem unlikely this time.
First Hydrogen shines with relative strength
In contrast to Nel ASA, First Hydrogen shines with relative strength and put a performance of almost 42% on the stock exchange floor since the beginning of the year. The stock is currently trading at EUR 1.91. At the level of EUR 1.80, there is a striking support area that could serve as a long-term entry level in the event of a setback. The Canadian company, headquartered in Vancouver and London, is a newcomer in the field of hydrogen-powered commercial vehicles. It aims to catch up with conventional suppliers through two agreements with AVL Powertrain and Ballard Power Systems Inc. and its best-of strategy.
The best-of strategy - the integration of existing technologies and a proven chassis - allows for both considerable cost and time advantages. In addition, the makers of First Hydrogen are manufacturer and technology neutral, so there is ultimate control and flexibility in using available components from preferred global suppliers. In addition to building the utility van, First Hydrogen boasts other assets currently unique in the market. For example, the Canadians plan to offer customers fuel cell-powered zero-emission and fully mobile supercritical CO2 extraction systems, enabling users to deploy the systems in remote locations where power grids are not available, or power supply is unstable.
First Hydrogen also has an ace up its sleeve through its strategic partnership with FEV Consulting GmbH. In cooperation, prototypes for a customized hydrogen filling station for the hydrogen mobility market are to be designed and built. The Canadians see the development of the hydrogen fueling station as an enhancement to their automotive strategy. First Hydrogen currently has a market cap of EUR 110.90 million, while its French counterpart McPhy Energy is almost three and a half times that at EUR 387.79 million.
Solid quarterly figures at Nio
"Despite supply chain issues and vehicle delivery challenges resulting from the recent COVID-19 recovery, we saw robust demand for our products and achieved record order intake in May," said CEO William Bin Li following the announcement of first-quarter figures.
The higher energy and raw material costs caused the gross margin to slump from 19.5% to 14.6%. On the other hand, record revenues of USD 1.55 billion were a positive, equating to sales of 25,768 units in total. In addition, the net loss fell to USD 200 million. On the stock market, Nio's shares could not hold on to the USD 20 mark due to the weak overall market and slipped below the critical support area at USD 17.60. The next important stop should be the area at EUR 16.
Due to inflation fears and concerns about further interest rate hikes, the broad market is correcting strongly. Nel ASA is about to become a penny stock, and Nio is testing an important support. First Hydrogen has so far been able to escape the downward pressure.
Conflict of interest
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