Hydrogen stocks are entering a buy zone, with many undervalued companies poised for significant gains if broader indices like the Nasdaq and S&P 500 receive an expected boost in liquidity. Despite their speculative nature, these hydrogen stocks present a potential for explosive growth. Investors prepared to take on some risk for potential high rewards should consider these opportunities.
These potentially millionaire-maker hydrogen stocks deserve attention due to their strong catalysts and the industry’s growing acceptance of hydrogen as a clean energy source. The following three hydrogen stocks have low market caps and strong growth trajectories, offering substantial potential for one’s grandchildren and for building intergenerational wealth.
My thesis is that as the climate crisis continues to increase in urgency, these multibagger hydrogen stocks will see their fundamentals and valuations improve as a result. Now is the best time to scoop up shares in these promising but speculative companies that could potentially make your grandchildren rich.
Plug Power (PLUG)
Plug Power (NASDAQ:PLUG) is a leading provider of alternative energy technology, primarily focusing on hydrogen fuel cell systems for material handling and transportation applications.
Despite Plug Power’s recent struggles, a contrarian view suggests significant upside potential. Over the past year, the stock’s 76% decline has created an attractive entry point for risk-tolerant investors. While the company continues to report losses, its revenue is projected to grow substantially from $941 million in 2024 to $3.52 billion by 2028, representing a compound annual growth rate of 39%.
The consensus analyst price target of $5.68 implies a 130% upside from the current price, indicating that Wall Street sees value not reflected in the stock price. Plug Power’s leadership in the hydrogen fuel cell market positions it well for the ongoing transition to clean energy.
With $1.17 billion in cash and a book value of $3.94 per share (well above the current stock price), Plug Power has the resources to weather near-term challenges. The company’s high short interest of 25.37% could potentially trigger a short squeeze, providing additional upward momentum.
Ballard Power Systems (BLDP)
Ballard Power Systems (NASDAQ:BLDP) focuses on proton exchange membrane (PEM) fuel cell technology for transportation, portable power and stationary power generation applications. The company has a strong track record of innovation and has been a leader in hydrogen fuel cell technology.
Ballard Power Systems demonstrated encouraging progress in its Q1 2024 results, with total revenue increasing 9% year-over-year to $14.5 million. The company’s order backlog saw significant growth, rising 38% from the end of Q4 2023 to reach $180.5 million, bolstered by $64.5 million in new orders received during the quarter. Gross margin improved by 5 percentage points compared to Q1 2023.
The company maintained a robust financial position, ending the quarter with $720.7 million in cash and cash equivalents. Ballard secured $94 million in non-dilutive funding for its planned Rockwall Gigafactory, supporting its expansion plans.
While the company continues to report losses, its revenue is projected to grow substantially, from $114 million in 2024 to $631 million by 2028, representing a compound annual growth rate of 53%. This then makes it one of those hydrogen stocks to consider.
Bloom Energy (BE)
Bloom Energy (NYSE:BE) designs, manufactures and sells solid oxide fuel cell systems for on-site power generation. Their products are used in various sectors, including healthcare, data centers and retail, providing clean and reliable power.
Bloom Energy’s Q1 2024 results showed mixed performance with revenue declining 14.5% year-over-year to $235.3 million and gross margin decreasing to 16.2% from 19.7% in Q1 2023. However, the company improved its operating loss to $49 million from $63.7 million in the previous year.
Despite the challenges, Bloom Energy maintained a strong cash position of $582.7 million and reaffirmed its full-year 2024 guidance, projecting revenue of $1.4 billion to $1.6 billion and non-GAAP operating income of $75 million to $100 million.
For contrarian investors willing to bet on a turnaround in the alternative energy sector, Bloom Energy offers a high-risk, high-reward opportunity with potential for significant long-term gains as the clean energy market develops for hydrogen stocks.
On the date of publication, Matthew Farley did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
