What happened 

Shares of alternative fuel companies dropped across the board despite some potentially positive news on Monday. Plug Power (NASDAQ:PLUG) shares fell as much as 11% and closed the day down 10.7%. Ballard Power Systems (NASDAQ:BLDP) fell as much as 15.4% before closing down 11.1%. And Bloom Energy (NYSE:BE) shares were off as much as 12.5% before ending the day down 11.7%. 

So what

The news was seemingly very good for alternative fuel stocks today. Plug Power got a higher price target from Craig Irwin at Roth Capital, who moved his estimate from $12 to $13 per share. He also increased his price target on Ballard Power Systems from $20 to $25.

Illustration of battery made of leaves with H2 and alternative energy art in the background.

Image source: Getty Images.

You might think stock upgrades would help shares, especially when the market traded higher for most of the day. But Plug Power, Bloom Energy, and Ballard Power Systems all dropped big today, and it may be explained simply by their stock chart. 

Shares of alternative fuel stocks have risen rapidly over the last month, so the pullback today and late last week may just be profit taking from traders who made big gains over that time. 

PLUG Chart

PLUG data by YCharts.

Now what

While I wouldn't read too much into today's drop, I wouldn't read too much into the big gains of the last month, either. All three of these fuel cell companies are still burning money every year and are a long way from reaching their potential in disrupting transportation as we know it. 

Fuel cells have long been about the story of the potential they bring to the energy market, and from time to time the market falls in and out of love with the story. Right now, shares are being pushed higher by optimism. 

What worries me is that fuel cells have always disappointed investors who believe in their future. Passenger vehicles have all but given up on fuel cells in favor of batteries, small trucks are trending toward batteries as well, and even some long-haul truck manufacturers think faster-charging batteries will be developed before a nationwide hydrogen fueling infrastructure makes sense. 

As these companies battle competing technologies, I go back to the losses they're seeing year after year. If the companies can't make money, I'll stay out of these stocks. And that's exactly why I would be a seller of these energy stocks today. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.