What happened

Hydrogen fuel cell stocks are moving higher Tuesday, the first trading day after the U.S. Department of Energy (DOE) made a big announcement that promises to help grow the hydrogen economy going forward.

Through 12:30 p.m. EST:

  • Bloom Energy (BE -3.22%) shares have climbed 7.1%;
  • Plug Power (PLUG -3.11%) has gained 8.5%;
  • Ballard Power Systems (BLDP -1.90%) stock is up 8.7%; and
  • FuelCell Energy (FCEL -8.02%) is leading the whole pack higher -- up 9.1%.
Cartoon fuel cell car on palm of hand putting out H2 bubbles as exhaust

Image source: Getty Images.

So what

Three factors appear to be at play today: Analyst upgrades, the DOE announcement, and earnings. Let's take them one at a time.

Ballard Power is one of today's biggest fuel cell gainers, and for good reason. This morning, analysts at BMO Capital announced they have initiated coverage of Ballard with a buy rating and a $39 price target, reports StreetInsider.com.

Plug may be the fuel cell company dominating all the headlines lately, but roughly 45% of fuel cell vehicles running in China today are running on Ballard Power fuel cells, notes BMO. Eighty percent of fuel cell buses in Europe are also Ballard's, as are 95% of fuel cell buses operating in California. BMO believes that Ballard's "demonstrated industry-leading durability" and technical expertise will prove to be "competitive advantages" going forward "as Ballard prepares for the potential rapid growth developing in the emerging fuel cell heavy-duty truck market over the next two to three years."

And speaking of growth, the DOE gave the fuel cell industry a big boost toward its growth goals on Friday when it announced $160 million in subsidies to fund the "production, transport, storage, and utilization of fossil-based hydrogen." Although this would appear to be at odds with initiatives such as Plug Power's project to produce "green hydrogen" (i.e., hydrogen separated from water through electricity generated from solar and wind power), it's still money, and free money from the government can only be good news for fuel cell stocks.  

Now what

How good will things get, with the U.S. government throwing its weight -- and its checkbook -- behind the fuel cell industry?

We'll get our latest look at how things are going for the fuel cell companies on Wednesday, when FuelCell Energy reports its Q4 and full-year fiscal 2020 financial results before the market opens. Analysts will be looking for a 54% increase in sales for FuelCell and a narrowing net loss ($0.04 per share -- tune back in on Thursday to see how that works out).  

Then we'll take a break for a few weeks, until Bloom Energy reports its Q4 results on Feb. 10, followed a few weeks later by Plug Power reporting on March 3. Ballard hasn't announced a date for its earnings yet, but seeing as it reported in early March last year, it's a safe bet that Q4 2020 earnings will come out in March again in 2021.  

For what it's worth, no analysts are predicting that any of these companies will actually report earning anything on their "earnings" days. Bloom Energy, however, is expected to get closest, with break-even profits predicted on a 5% gain in sales.

Fingers crossed.