Alternative energy stocks are making headlines again Thursday, as shares of hydrogen fuel cell companies Bloom Energy (NYSE:BE) and Plug Power (NASDAQ:PLUG) continue to climb -- up 2.9% and 7.4%, respectively, as of 12:30 p.m. EST -- and nuclear fuels supplier Energy Fuels (NYSEMKT:UUUU) takes off on a 10.5% romp.
What's behind these moves higher? In the case of Bloom (and Plug, of course), I think we're seeing revived momentum partly tied to Plug's announcement yesterday that it is expanding its relationship with key customer Walmart.
There weren't a whole lot of details given out on the expansion -- just that it relates to Walmart's e-commerce operations and appears to involve "GenKey hydrogen and fuel cell solutions" used in fuel cell-powered forklifts operated at Walmart's distribution centers. And that lack of detail may explain why Plug's share price gains yesterday mostly faded as the day wore on.
Regardless, Plug and Bloom are getting a second boost today from news that a third name-brand fuel cell company, Ballard Power, has signed a deal with a Belgian customer to purchase 10 fuel cell modules to power electric buses in the Netherlands. The buses are expected to require between 60 and 90 tons of hydrogen annually, which may be reminding investors of Bloom's and Plug's plans to slowly evolve from producers of fuel cells into producers of fuel cells and hydrogen to power those fuel cells. Small as those numbers may be, they seem to be giving an outsize boost to both Plug and Bloom stocks today. Ballard is higher, too -- up 3.2%.
Now turning from fuel cells to nuclear power: What's the deal with Energy Fuels? You may be surprised to learn that it actually has little to do with nuclear power, energy, or fuels of any sort.
Rather, Energy Fuels stock has been rising this week largely in response to its announcement back on Monday that it's branching out into the rare-earth metals business as a corollary to its core uranium mining business. According to the company, Energy Fuels has signed a three-year deal to supply The Chemours Company (NYSE:CC) with rare-earth element (REE)-bearing "natural monazite sands" beginning in the first quarter of 2021.
Monazite, says Energy Fuels, is rich in uranium -- which it plans to extract for itself after mining -- but also in REE such as neodymium and praseodymium that Chemours covets. Once it's done separating out the uranium for itself, therefore, Energy Fuels plans to process and sell the sands to Chemours for a bit of extra money -- supplying "close to 10% of total current U.S. REE demand" in the process.
No value was ascribed to the contract, so it's unclear whether this deal will be sufficient to turn Energy Fuels -- which has only earned a profit once in the last 20 years -- into a profitable operation. Still, rare-earth metals remain a popular item among momentum stock traders. And that's the reason Energy Fuels stock is enjoying its outsized bump today.