PLUG to FCEL: 5 climate-friendly hydrogen stocks to watch in Q2

Highlights 

• Air Products and Chemicals, Inc. (NYSE:APD) has a dividend yield of 2.75%, with an annualized dividend of 6.48.
• Plug Power, Inc. (NASDAQ:PLUG) and Olin Corporation signed an MoU in April to create a joint venture (JV) to produce & market green hydrogen.
• FuelCell Energy, Inc. (NASDAQ:FCEL) announced to extend the agreement term with ExxonMobil Technology and Engineering Company through Dec 31, 2022.

Hydrogen is one such energy source that emits no greenhouse gases, and the only waste it generates is water vapor. 

However, the challenge lies in the availability of hydrogen. It is not always found in gaseous form. To produce hydrogen, sometimes the process emits greenhouse gases. This could be a viable source of alternate energy in the future with technological advancement.

Another challenge is that most of the hydrogen present is ‘gray hydrogen’. 

Gray hydrogen is produced using fossil fuel that emits greenhouse gases. There is also brown hydrogen, which is generated from coal gasification, creating greenhouse gases in the process. The third is blue hydrogen, which requires carbon capture and underground storage to achieve zero greenhouse gas emissions.

Here, we discuss five stocks that are working in the hydrogen field.

Air Products and Chemicals, Inc. (NYSE:APD)

Closing price on May 6, 2022: US$235.82
Price range in last 52 weeks: US$316.39 to US$216.24

Air Products and Chemicals, Inc. is an industrial gas supplier and the largest supplier of Helium and Hydrogen globally. The company has around 19,000 employees and operates in 50 countries. Headquartered in Allentown, Pennsylvania, its products are supplied to the chemical, metals, healthcare, energy, and electronics industries.

For the quarter ended March 31, 2022, its sales were US$2.95 billion compared to US$2.50 billion in the same quarter a year ago. The net income attributable to the company was US$530.5 million or US$2.38 per diluted share compared to US$473 million or US$2.13 per diluted share in the March quarter of 2021. 

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On May 3, the company announced developing hydrogen trucks and a public hydrogen refueling station collaborating with Schenk Tanktransport and TNO for the clean Hydrogen and Road Transport Project in the Netherlands. The company is expected to supply the first Rotterdam green hydrogen filling station for trucks in 2023.

The stock has a market capitalization of US$51.89 billion. Its P/E ratio is 23.31, and the forward P/E for one year is 23.03. The dividend yield is 2.75%, with an annualized dividend of 6.48.

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Plug Power, Inc. (NASDAQ:PLUG)

Closing price on May 6, 2022: US$19.41 

Latham, New York-based Plug Power Inc is an innovator of modern hydrogen and fuel cell technology. Its GenKey solution is designed to improve productivity and reduce operating costs and carbon footprints. It even replaces lead-acid batteries with its hydrogen and fuel cell products to power electric industrial vehicles. 

For the fiscal year ended December 31, 2021, the net revenue of the company was US$502 million, and the net loss attributable to the common shareholders was US$460 million or US$0.82 per share diluted. The net loss came in at US$596 million or US$1.68 per share diluted in fiscal 2020.

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On April 28, the company announced the signing of a memorandum of understanding (MOU) with Olin Corporation to create a joint venture (JV) to produce & market green hydrogen. The green hydrogen is intended to support growing fuel cell demand.  The first production plant in St. Gabriel, Louisiana, is expected to produce 15 tons per day (TPD) of green hydrogen.

PLUG’s current market capitalization is US$10.28 billion. 

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Bloom Energy Corporation (NYSE:BE)

Closing price on May 6, 2022: US$15.13

Bloom Energy Corp is a consumer durable sector company. It provides electric power solutions, including a broom energy server and a stationary power generation platform, to supply uninterrupted power.  The San Jose, California-based company offers services under operation and maintenance contracts and sells electricity under PPA agreements to the customers.

For the quarter ended March 31, 2022, it reported a revenue of US$201 million compared to US$194 million for the same quarter the previous year. Its net loss came in to be US$82.7 million or US$0.44 per share diluted compared to US$29.78 million or US$0.15 per share diluted for the March quarter in 2021.  

BE stock has a market capitalization of US$2.47 billion. 

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Ballard Power Systems, Inc. (NASDAQ:BLDP)

Closing price on May 6, 2022: US$7.83

Ballard Power Systems Inc is a clean energy company. British Columbia, Canada based Ballard develops and commercializes proton exchange membrane fuel-cell. It designs, develops, manufactures, sells, and services fuel cell products for different applications. 

A fuel cell is an environmentally clean electrochemical device that combines oxygen from the air with hydrogen fuel and produces electricity.  

On May 9, it entered a strategic collaboration with Wisdom Motor Company Limited, Templewater Group, and Bravo Transport Services Limited to speed up commercial fuel cell electric vehicles (FCEV) adoption in Hong Kong.

It reported total revenue of US$21.0 million in the March quarter, 2022, a 19% increase YoY. The net loss from continuing operations came in at US$40.4 million or US$0.14 per share compared to US$17.8 million or US$0.06 per share in the previous year’s March quarter.

The stock has a market capitalization of US$2.16 billion. 

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FuelCell Energy, Inc. (NASDAQ:FCEL)

Closing price on May 6, 2022: US$3.92

Danbury, Connecticut-based FuelCell Energy Inc is a fuel-cell power company. The company is engaged in designing, manufacturing, selling, installing, operating, and servicing fuel cell products. These fuel cell products convert chemical energy into electricity. Fuel cells are supplied to industries engaged in wastewater treatment, hospitality, data-centers, communication, healthcare, etc. 

The company reported revenue of US$31.8 million for the quarter ended January 31, 2022, compared to US$14.9 million in the same quarter of 2021. It incurred a net loss of US$46.12 million or US$0.11 per diluted share compared to US$45.96 million or US$0.15 per share diluted in the same quarter the prior year.

On May 5, the company announced extending the term of the agreement with ExxonMobil Technology and Engineering Company through December 31, 2022. Under this continued joint development agreement, the companies will continue working to advance fuel cell carbon capture and storage technology and its commercialization.

FCEL has a current market capitalization of US$1.32 billion. 

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Bottom line:

Amid the rising climate extremity, environmentalists, governments, and individuals are working to fight the decaying environment. Organizations focus on reducing dependence on fossil fuels and leveraging more renewable energy sources that emit zero or significantly less greenhouse gas when burned. However, while selecting the stocks, one must exercise caution and analyze the company's fundamentals.