What happened

Investors recently have been shunning the alternative energy sector in favor of cyclicals and value stocks in an environment of rising commodity prices. Fuel cell names including Plug Power (PLUG -3.38%) and Bloom Energy (BE -3.54%), along with fuel cell electric vehicle (FCEV) maker Nikola (NKLA 1.67%), have been part of the sell-off.  That trend continued today, with shares of those stocks moving as follows as of 11:15 a.m. EDT:

  • Plug Power down 8.8%.
  • Bloom Energy down 10.3%.
  • Nikola down down 1.6%. 

So what

Nikola had been down more than 5% earlier in the session, and the recovery may be related to investors looking back on the company's first-quarter financial update from Friday. Bloom Energy also reported its first quarter last week and had some positive news. But what qualified as some positive developments for these growing companies wasn't enough for the stocks to buck current investor sentiment. 

Nikola semi truck at hydrogen refueling station

Nikola semi truck at hydrogen refueling station. Image source: Nikola.

Now what

On Friday, Nikola said it continues commissioning the first batch of five Tre battery electric vehicles (BEVs) and has another eight already built at its Ulm, Germany, facility. They are in various stages of transit or testing, with another nearing completion and expected at the Arizona facility by the end of this month. The company also said it expects to break ground on its first commercial hydrogen station this year, and to name additional hydrogen infrastructure and ecosystem partners. 

Bloom Energy reported strong progress as it remains in growth mode with its fuel cells, as well as initiatives to help grow the hydrogen fuel economy. Bloom said revenue grew 24% over the prior-year period. Maybe more importantly, the company's gross margin soared to 28.2% for the quarter -- an impressive 15.5-percentage-point jump over the 2020 first quarter.  

Even if investors weren't rotating out of these names, they might have reason to walk away from Plug Power. It hasn't reported its first-quarter financial update yet, and in fact had to delay presenting its 2020 annual report, after an accounting item forced it to restate financial results back to 2018. Plug has until May 17 to file its 2020 Form 10-K with the Securities and Exchange Commission.

Until investors see the resolution of Plug's financial report, it will likely remain in the penalty box. But Bloom, which hasn't attained profitability, and Nikola, which still remains prerevenue, both showed decent progress toward long-term goals. Investors will want to see more of that before deciding to switch funds back in that direction, however.