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February 20th, 2024 | 07:45 CET

ThyssenKrupp Nucera, dynaCERT, Plug Power - Hydrogen Stocks: Buy or Wait?

  • Hydrogen
  • Electromobility
  • greenhydrogen
Photo credits: pixabay.com

In light of global efforts to reduce CO2 emissions, hydrogen is coming into focus as a promising alternative in the transportation sector. The quick refueling times and greater ranges of hydrogen are particularly enticing, potentially solving the challenges of electromobility. Fleet operators must also become active, especially in response to the savings demanded by the government. Despite the clear potential for more sustainable mobility, hydrogen companies currently find themselves in a challenging situation on the stock markets, plagued by market uncertainties and the challenges of a nascent technology. Today, we look at three companies whose business is based on hydrogen.

time to read: 4 minutes | Author: Armin Schulz
ISIN: THYSSENKRUPP NUCERA AG & CO KGAA | DE000NCA0001 , DYNACERT INC. | CA26780A1084 , PLUG POWER INC. DL-_01 | US72919P2020

Table of contents:


    Dirk Graszt, CEO, Clean Logistics SE
    "[...] 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

    Full interview

     

    ThyssenKrupp Nucera - A good start to the year

    In mid-February, the European Union announced the provision of EUR 6.9 billion in funding for clean technologies. ThyssenKrupp Nucera should benefit from this initiative. The Company offers leading technologies for the production of green hydrogen and electrolysis on an industrial scale to support environmentally friendly processes and make industry less polluting. As with other hydrogen companies, investments have to be made first. This puts pressure on EBIT.

    The Company started the new financial year 2023/2024 with strong growth in the first quarter. The electrolysis specialist recorded incoming orders of EUR 175.5 million, with the alkaline water electrolysis (AWE) segment standing out, with an increase of 34% to EUR 109.1 million. Sales rose by 34.6% to EUR 208.3 million, with the AWE business generating sales of EUR 120.6 million. EBIT fell to EUR -0.9 million due to start-up costs in the hydrogen business. The forecast for the financial year envisages significant sales growth in the mid double-digit percentage range.

    This exceeded the expectations of analysts, who had forecast lower sales and a higher EBIT loss. In contrast to other hydrogen suppliers, the Group reported a positive net profit of around EUR 2.8 million. The order backlog amounted to almost EUR 1.34 billion after the first quarter. The figures also impressed analysts. In February, Deutsche Bank and Berenberg issued "Buy" recommendations with price targets of between EUR 22 and EUR 29. The share, which was dragged down in the wake of the negative hydrogen environment, is currently still a good 40% away from this. It is currently trading at EUR 15.46.

    dynaCERT - Before Verra certification

    Research on hydrogen-powered trucks is taking place worldwide, with even Daimler Truck deciding to develop trucks with hydrogen propulsion. But this development takes time. Following that, the infrastructure must be established, which cannot be done overnight. Nevertheless, if a fleet operator wants to reduce its emissions, dynaCERT's HydraGEN™ technology offers a way to reduce carbon emissions from diesel engines and also achieve considerable fuel savings and engine-related benefits. This is achieved by injecting hydrogen and oxygen into the combustion process to optimize it.

    In addition to the savings, the Company also wants to generate CO2 certificates in the future. dynaCERT is working with Verra on this and has cleared all the hurdles. Most recently, the last missing assessment report, which was prepared by Earthood Services, was submitted. Accordingly, the Company should receive certification from Verra after their evaluation. This would provide the Company with another selling point. However, even without the certification, the Company was able to significantly increase its sales figures in the past year. In addition to new orders, there were a number of repeat orders, indicating that the HydraGEN™ technology has been convincing.

    **The Holeshot Competition team also used the system in the truck category at the Dakar Classic 2024. Here, the team achieved 3rd place, a testament to dynaCERT's brand awareness. dynaCERT recently announced a private placement of CAD 6 million, of which CAD 3.86 million has been completed to date. The remainder may be placed in the coming days. Those interested in learning more about the Company can participate in the 10th International Investment Forum on February 21. dynaCERT CEO Jim Payne will present at 16:00 CET and answer questions live. The share has been trading in a narrow sideways range between CAD 0.145 and CAD 0.17 since mid-January and is currently trading at CAD 0.155.

    dynaCERT will present at the 10th International Investment Forum: dynaCERT

    Plug Power - 2nd plant produces green hydrogen

    Plug Power was once the shining star of the hydrogen industry. At the end of January 2021, the share marked its all-time high at USD 75.49. On January 18, 2024, the value was only USD 2.26. This was preceded by many missed targets due to overly high forecasts, rising interest rates, uncertainties in the markets, delays in projects and ultimately, the announcement that the Company does not know whether it will still be solvent in 12 months' time. After all the bad news, there has recently been more positive news.

    On January 23, the production of liquid green hydrogen started, albeit late, at the Georgia plant, which is considered to be the largest in the US. The plant uses 8 PEM electrolysers. It produces 15 tons of liquid hydrogen daily, enough to power around 15,000 forklift trucks. The first deliveries to customers have already been made. On February 6, the plant in Tennessee also started producing around 10 tons of green hydrogen per day. According to the Company, plant efficiency has been improved through design adjustments. Plug Power's average costs should fall as a result of producing its own green hydrogen. Previously, the Company had to purchase all of its hydrogen.

    At the beginning of February, the Company secured an order in Europe to supply a basic engineering and design package for a 500-megawatt electrolyser project. Prior to this, there had been no significant orders for a long time. The figures for the fourth quarter are to be presented on February 28. As the positive news will only have an effect in the coming quarter, little impetus is expected from the upcoming figures. In addition to a capital measure, Plug Power intends to save up to USD 75 million a year with a cost-cutting program and thus ensure its financial survival. The share has recovered from its lows this year and is currently trading at USD 3.96.


    Hydrogen can help to reduce emissions worldwide in many ways. There is still a lot of development work to be done. ThyssenKrupp Nucera has already generated a net profit despite increased investments in the hydrogen sector. dynaCERT uses hydrogen to improve the combustion process in diesel engines and can thus directly contribute to reducing emissions. There is significant upside potential with a Verra certification. Plug Power is trying to achieve the turnaround. Reducing costs and increasing margins** are on the agenda. It remains to be seen whether these measures will be sufficient.


    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

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    Der Autor

    Armin Schulz

    Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.

    About the author



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