Fuel cell stocks are on the move today. Today, shares of FuelCell Energy (NASDAQ:FCEL), Bloom Energy (NYSE:BE) and Plug Power (NASDAQ:PLUG) are all down more than 5%. It appears investors are continuing to view recent news around proposed infrastructure spending negatively.
President Joe Biden’s infrastructure bill totaling $3 trillion will be coming into the spotlight soon. In fact, the White House has said he will reveal the first details later this week. However, this upcoming infrastructure catalyst may not be a boom for fuel cell stocks.
This spending package was initially expected to be broad, spanning multiple sectors. Indeed, there was widespread hope that support for clean energy investments would materialize. This sort of direct support is a key catalyst behind fuel cell players such as PLUG stock.
But now, expectations that immediate support for clean energy sectors will materialize appear to be overblown.
Fuel Cell Stocks Feeling Brunt of Deal-Making
In pushing this piece of legislation through, it appears some level of compromise is going to be needed to get the deal done.
Experts now anticipate that the first phase of this bill could focus primarily on what most people think of as “traditional” infrastructure. You know, roads, bridges, that sort of thing. Biden did promise $2 trillion of investments into clean energy infrastructure such as electric vehicle charging stations during his campaign, and Democratic lawmakers are still pushing for a green focus in the current legislation. However, experts believe that investments in things like green energy, child care or healthcare (other Biden focuses) could get pushed aside. Although this may be necessary compromise, clean energy companies are lagging on this news.
Investors may rightly believe that hydrogen is the future. Indeed, these stocks have done tremendously well over the last 12 months. However, near-term stock price movements on a year-to-date basis show quite a different story.
Hydrogen-related clean energy investments are uniquely sensitive to infrastructure spending. Indeed, billions of dollars of investment will be required to see hydrogen fuel cell tech flourish. Until more clarity is provided in terms of a road map on how this sector will be built out over time, investors appear cautious.
Those considering picking up shares of FCEL, BE, or PLUG stock today may want to consider being patient. More dips could be on the horizon. Indeed, if delays with clean energy support continue, that’s bearish for this sector.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article.