Finally: FuelCell Energy has agreed and settled with South Korean company Posco. FuelCell is now independent from Posco again and can pursue other opportunities in Asia. The company figures of FuelCell Energy are not yet very convincing, given the last quarterly results: a measly 14 million USD turnover. Although there are pending orders of 1.29 billion USD in the books, so far seemingly few new orders are coming in. The cooperation with ExxonMobil was extended once again, but with no new conditions to report.
The enormous interest in hydrogen and fuel cell technology has brought a lot of attention to the publicly listed companies in this field. Fuel cell producers like Bloom Energy, however, are finding it difficult to benefit to a comparable extent from the upswing in the H2 sector because their plants are still dependent on fossil gases for the time being. H2-international talked to the head of business development at Bloom Energy Germany, Dr. Stephan Reimelt, about some challenges involved in supplying decentralized energy through fuel cell plants.
With ExxonMobil, FuelCell Energy is already working nicely with regard to carbon capture. Now ExxonMobil has published a six-year plan that sees the corporation wanting to invest USD 15 billion in this area. As a result, I therefore believe that for FuelCell Energy there is potential for many a supplementary and major order.
The daily price fluctuations of the shares in the hydrogen and fuel cell sector discussed here – primarily those from the USA and Canada – give an indication that very different interests determine events here: Thus, on many days in July 2021, there was a concurrence of price declines with almost identical percentage losses in the prices of all these shares with manageable trading volumes at the same time. In other words: The buy side held back and the forces betting on falling prices had the upper hand. However, no selling pressure could be detected, which is reflected in the amount of shares traded.
There has been a stark rise in the valuation of the business from around USD 100 million to now over USD 9 billion, with the stock price increasing from USD 1 – USD 2 to USD 29. I would go so far as to call it totally excessive. I got early wind of FuelCell Energy [Nasdaq: FCEL] as a turnaround after a management consultancy had “cleaned it up” and after the company had undergone a period of refinancing and restructuring and happily onboarded Orion Energy Partners as a key investor.
As third-quarter results faded in the rear-view mirror, Bloom Energy stock rebounded with a vengeance following a temporary slump. Natural disasters, including storms and floods, prevented the completion of 41 projects, pushing revenue below the anticipated USD 225 million to USD 200 million, And yet, the company’s USD 12 million in the red means Bloom [NYSE: BE] performed much better than expected. The net loss was “only” USD 0.09 per share instead of USD 0.16 and including non-recurring revenues, that loss shrank to as little as USD 0.04 a share.
Fuel cell and hydrogen stocks are riding a wave of popularity as a new megatrend sweeps the market. So far, every single one of these stocks has exceeded expectations. But how long will the love affair between investors and the industry last? Will analysts and shareholders use new methods to evaluate business models, prospects, backlogs, submarkets and revenues, and, above all, the potential for profit? And will the market separate the wheat from the chaff? I’d say yes, that will definitely happen.
Since the beginning of the year, the fuel cell stocks covered in this issue had seen a fast uptrend, which ended with the spread of Covid-19 around the world. Fears over the impact of the disease on the global economy meant some gains were quickly lost. Still, in light of increased news coverage, multiple project announcements and the growing popularity of green hydrogen, it has become clear that hydrogen and fuel cells are entering the mainstream and their breakthrough into the market is approaching rapidly.
The figures for the third quarter were satisfactory: On balance, earnings per share were $ 0.01, with the quarterly loss being due to stock-based compensation (issuance of shares and options to employees), which is “extraordinary” accounting and non-operating.
The reports are coming thick and fast: Chinese companies and some provinces are planning to initially invest US$17 billion in hydrogen technology. A master plan already provides for 1 million FC vehicles on the country’s roads in 2030.