3 stocks you should keep an eye out for in the energy sector: Bloom Energy (BE), Fuelcell Energy (FCEL), Plug Power (PLUG) and Clean Energy Fuels (CLNE), here’s why.
As of 1:20 p.m. on November 17th, hydrogen fuel cell stock Plug Power (PLUG) shares were up a decent 6.1 percent. EST, while Bloom Energy (BE) and Clean Energy Fuels (CLNE) (a stock of natural gas) and FuelCell Energy (FCEL) rivals Plug are doing twice as well—increasing 14.2% and 12.9%, respectively.
Curiously, although the smallest stock price gains of the three are stocks, Plug Power stock is the only one of these stocks with good news to support it.
Over the weekend, Barron’s magazine called Plug Power “one of this year’s stock market standouts,” with the stock up six times in 2020, setting the stage for a $1 billion stock offering that promises to give Plug enough prepared cash to fuel its growth for years to come..
Barron’s sad Plug partially benefits from the widespread popularity among investors this year of renewable energy, ‘electric vehicles, hydrogen power, and fuel cells’ stocks. (And this broad call-out of renewable energy technologies can explain the enthusiasm of investors today for Bloom Energy and Clean Energy fuels.)
For investors, here’s the real question as they think about whether Plug’s sales success will continue:
Plug recorded a lot of Walmart and Amazon sales largely because along with fuel cells, it was selling warrants for its stock. (Walmart and Amazon are entitled to purchase another batch of warrants for every $50 million worth of fuel cells acquired, according to Barron’s). But for every customer it tries to sell fuel cells to, will Plug have to continue pairing warrants with fuel cells to encourage sales of its fuel cells?
And what happens to Plug’s sales growth if it tries without stock warrants to sell the fuel cells? As fuel cells grow in popularity around the globe, it might not have any issue at all. But if all those businesses — and investors — are really interested in owning the red-hot plug stock, it could have a lot of problems.