Ballard Power – well-prepared, still going strong

Telecommunication pole, Thailand.
Telecommunication pole, Thailand.

The manufacture of the new powerful LCS stack, through a Weichai-Ballard joint venture in China, will start in the second half, or around the middle, of 2020. In my opinion, it will lay the foundation for high, long-term growth in revenue and profit. Considering what month it is, we will not have to wait long to find out. The positive news coming from this will form the basis for price trends throughout the year. I estimate a big jump, as Ballard Power is the global leader in manufacturing fuel cells.

Encouraging results in 2019 – more on the horizon

The numbers for fiscal year 2019 turned out well. Fourth-quarter results were in line with expectations. Revenue was USD 41.9 million, bringing year-on-year growth to 47 percent, more than USD 10 million above forecast. Full-year revenue came to USD 106.3 million; the net loss per share was USD 0.04. Ballard also had a healthy reserve of USD 147.8 million in cash. Regarding 2020, the company anticipates a total revenue of USD 130 million. It also said it would raise fresh capital from time to time through an at-the-market equity program, which could rake in up to USD 75 million. This puts Ballard [Nasdaq: BLDP] in a good market position, since it will not need new loan facilities or more than a small amount of the cash it has on hand. Maybe, though, it wants the USD 75 million for something else, like buying another company?

Fuel cells for radio towers

In January, SFC Energy and adKor placed an order with Ballard for 500 fuel cell systems, to be deployed at radio tower sites in Germany. Another 1,000 may be added at a later date. This is a highly intriguing piece of news, as the company once planned to branch out into the sector in China. It was reportedly in talks with China Tower, which owns over 35,000 towers, though the talks were going nowhere. Now, Ballard will finally be able to enter a market that it has had an eye on for a long time.

read more in H2-international May 2020

Risk warning
Share trading can result in a total loss of your investment. Consider spreading the risk as a sensible precaution. The fuel cell companies mentioned in this article are small- and mid-cap businesses, which means their stocks may experience high volatility. The information in this article is based on publicly available sources, and the views and opinions expressed herein are those of the author only. They are not to be taken as a suggestion of what stocks to buy or sell and come without any explicit or implicit guarantee or warranty. The author focuses on mid-term and long-term prospects, not short-term gains, and may own shares in the company or the companies being analyzed.

Author: Sven Jösting, March 19th, 2020

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