Canadian producer Hydrogenics (Nasdqaq: HYGS) and British manufacturer ITM Power (London: ITM) aren’t entirely comparable, but they use similar technologies. There are some commonalities in the form of power-to-gas projects, hydrogen stations and powerful electrolyzers to generate the gas. Their market caps aren’t as far apart as I would expect based on the number and contract value of bookings. Both stocks have experienced severe price drops.
The dust has settled on a rally to the top and a share price that nearly tripled temporarily. Stock market experts like to call it chart consolidation and profit taking. ITM (London: ITM) was successful in raising EUR 120 million in fresh capital. Now, the British manufacturer’s market capitalization is above long-term expectations despite its bright outlook. I think investors should put this one on the watchlist, but look for other, more promising options in the meantime.
Northern Germany is well on its way to becoming a power-to-gas El Dorado. The past years have seen citizens’ initiatives and businesses initiate projects to explore new avenues in this wind-rich region. Most of their activities have yet to hit the mainstream news and some weren’t even known to many professionals in the industry. But recently, an increasing number of publications have been focusing on ongoing projects, so we thought it was time to take a closer look at what’s happening.
ITM Power (NASDAQ: ITMPF) is the first R&D fuel cell business from the UK making the jump onto the British stock exchange. ITM manufacturers power-to-gas systems, H2 filling stations and electrolyzers. Currently, it is working on a module-based electrolyzer that could allow for combinations offering up to 100 MW capacity.
There has been quite an interest in energy storage recently. And as ever more power-to-gas systems have been popping up all over Germany, project planners are increasingly turning their attention to the key elements found on-site: electrolyzers. These electrochemical units to create hydrogen have been around for a long time.
Despite a higher-than-expected net loss of USD 1.9 million in the third quarter and only USD 6.7 million in revenue – down 30 percent from the same period the year prior – Hydrogenics could report a record USD 106.2 million in order bookings, of which USD 30 million should be realized within the next 12 months. One of the customers that had placed new orders was E.ON, and the integration of fuel cell stacks with trains and streetcars in collaboration with Alstom is turning out to be a success.
The changes on the Hydrogen Europe board are not over yet. At the assembly in Brussels on Nov. 24, 2016, the association’s members elected Nils Aldag from sunfire as energy chair, Denis Thomas from Hydrogenics as membership and joint undertaking commitment chair and Werner Diwald from the DWV as association pillar chair. Aldag replaced Katharina Beumelburg from Siemens and Thomas succeeded Thomas Melczer, who used to work at Proton Motor
After the second-quarter figures from Ballard Power Systems came in at the end of June, there were several good news that underline which huge potential the Canadian fuel cell manufacturer can tap in China and Japan. The share price jumped more than 60 percent. The most recent business Ballard won over as a partner was Chinese Broad-Ocean. The corporation boasts an annual production of more than 50 million motors worldwide and supplies several top-notch carmakers
If one takes into account order bookings, collaborations, product developments and prospective markets, buying shares of fuel cell companies looks ever more promising. But the capitalization of the market leaders in fuel cells described in this article amount to a mere USD 750 million – a stark contrast to Tesla, the electric car pioneer, which has a market cap of USD 34 billion. These companies may very well get closer over the coming years, if Tesla gradually loses in value while fuel cell shares increase considerably in price.
The fuel-cell companies quoted on the stock exchange have used 2015 perfectly to strengthen their market positions. These efforts have resulted in more orders, improved balance sheets, increased capital and some very important strategic collaborations as well trendsetting product developments. This lets us conclude for 2016 that probably most of these companies – if not all – will be able to become cash-flow positive or even generate sustainable profits after many years of preparing for this moment.