What happened
Shares of hydrogen fuel cell stocks Plug Power (PLUG -0.73%), Bloom Energy (BE -0.51%), and FuelCell Energy (FCEL -6.93%) went on a roller-coaster ride Monday. In early trading, all three of these fuel cell companies traded down sharply, with Plug and Bloom stocks both falling about 10%, and FuelCell dropping nearly 9%.
Things are turning around, however. In early afternoon trading, Plug and Bloom have both erased nearly all their losses of earlier in the day, and FuelCell stock is actually now "in the green," up 4.5% from Friday's close as of 12:20 p.m. EST.
Image source: Getty Images.
So what
But why did these stocks dip in the first place? Crazily, the sell-off doesn't appear to have anything to do with any of these three fuel cell stocks themselves. Rather, investors appear to be fleeing renewable energy stocks in general, in response to the news earlier today that General Motors has scrapped its plans to invest $2 billion in electric-truck start-up Nikola.
This news seems to have spooked investors in Plug, Bloom, and FuelCell -- all of which, like Nikola, are unprofitable enterprises that folks may (reasonably) assume will depend on support from larger, more established firms such as GM if they are to make it to the big time. If GM is losing faith in the technology, as the reasoning may go, then other big companies may also withdraw their support, causing fuel cell technology to wither on the vine.
Now what
This is cause for concern. However, there's at least some good news to report today as well. To wit, this morning Plug announced that it has signed a deal with France's Gaussin "to bring a commercial suite of ProGen-powered Gaussin transportation vehicles to market in 2021."
Says Plug, "Gaussin terminal tractors" and "automated guided vehicles ... will use green hydrogen produced by Plug Power's best of class PEM electrolyzer solution," targeting "new cargo markets, including logistic centers, seaports and airports in Europe, the United States, and globally beyond," with production to commence early next year.
That sounds like a big deal, and Plug CEO Andy Marsh promises that "partnerships with OEM leaders, like Gaussin, allow us to drive green hydrogen solutions in the United States, Europe and beyond." Before you invest in Plug based on the news, however, know this:
If you've never heard of Gaussin before, there's a reason for that. Specifically, it really isn't that big of a company, weighing in with a market capitalization of less than $200 million and annual revenue of barely $11 million (according to data from S&P Global Market Intelligence). In short, a partnership with Plug may be a bigger deal for Gaussin than a partnership with Gaussin is for Plug Power stock.
