Together, these five stocks make up a good chunk of the green economy, pioneering the use of clean natural gas, solar power, and novel fuel cell technologies that promise to unshackle the world from its dependence on oil, make distributed generation of power more feasible, and help put an end to global warming.
That is, they might do all of these things if their stocks don't all plummet to zero -- which kind of feels like the direction they're heading on a day like today. As of 2:20 p.m. EDT, shares of First Solar are down 10.8%, Ballard Power 12%, Plug Power 16.2%, Clean Energy 16.7%, and Vivint Solar a staggering 18.8%.
Why is this happening? Well, coronavirus, obviously. That's kind of been the theme of this entire market rout over the past few weeks.
Today, Johns Hopkins University reports there are more than 211,000 confirmed cases of COVID-19 stretching across 157 countries worldwide, and 8,700 deaths have been reported.
Yet coronavirus is not the end of this story. As the pandemics applies brakes to the global economy, demand for oil is plummeting -- and oil prices along with it. Just today for example, the price of a barrel of West Texas Intermediate crude plummeted 23% to less than $21 a barrel, and the international benchmark Brent Crude oil isn't much more -- down 12.5% to $26 and change.
Here's why this is significant: Alternative energy sources -- and stocks like First Solar and Vivint Solar, like Plug, Ballard, and even Clean Energy Fuels -- are "alternative" because they're alternatives to oil.
Granted, there's always a "green" angle to these things, but "green" has always felt a bit touchy-feely on Wall Street. More important is how green energy compares to black gold in terms of dollars and cents. And from that perspective, the cheaper oil gets, the less attractive alternatives to it become.
Long story short: Coronavirus plays a part in this story, sure. But oil prices are the real plot line to follow. Until oil prices recover, don't expect alternative stocks to do well.