What happened
This week was a test for investors' nerves. If you look at the charts for some alternative energy stocks, for instance, you'll see how they slumped as the week kicked off -- some even plunging to 52-week lows -- only to bounce back just as dramatically even as I write this. Believe it or not, shares of Ballard Power Systems (BLDP 3.91%), Clean Energy Fuels (CLNE +0.00%), and Blink Charging (BLNK +7.23%) are up more than 15% each in the past two days through 2 p.m. ET Friday, but they're still down for the week according to data provided by S&P Global Market Intelligence.
- Ballard Power Systems: down 13.4%.
- Blink Charging: down 2.5%.
- Clean Energy Fuels: down 5.9%.
Each of these stocks hit 52-week lows this week. Each of these companies also released its quarterly numbers in the past few days, with one even crushing analysts' estimates. That tells me this one stock, at least, could have ended the week on a much stronger note if not for the choppy markets.
So what
Clean Energy Fuels announced its first-quarter numbers late last week. Traditionally known for its large network of fueling stations, Clean Energy is now diversifying to produce renewable natural gas (RNG) from organic waste -- a move that has attracted the attention of analysts and investors alike.
Analyst Pavel Molchanov from Raymond James, for example, upgraded Clean Energy stock's rating to outperform with a price target of $6 a share this week, partly because of the potential reinstatement of federal tax credits that support clean energy. Clean Energy Fuels' revenue grew 8% year over year to $83.5 million in the first quarter as the company delivered 3.7% higher million gallons of fuel and 7.3% higher million gallons of RNG, both year over year.
Clean Energy Fuels stock, however, still tanked after earnings as its numbers missed estimates on both the top and bottom lines.
Ballard Power, which manufactures clean energy fuel cell products for use in transportation and stationary power, also saw its shares tumble after first-quarter earnings were released on May 9. Ballard Power's revenue growth of 19% still missed analysts' estimates by a wide margin, and the company reported a loss of $0.14 per share versus $0.06 a share in Q1 2021.
Worse yet, Ballard Power's gross margin came in negative, and its 12-month backlog as of the end of the first quarter also fell a bit to $65.8 million. Soon after earnings, analyst Christopher Souther from B. Riley slashed Ballard Power stock's price target to $12 a share on concerns about challenges in China where the company operates a key joint venture with diesel engine maker Weichai Power.
Image source: Blink Charging.
Blink Charging also received a couple of price cuts this week, but I'd have expected shares of the electric vehicle (EV) charging company to charge even higher this week given its stunning growth in revenue. Here are some numbers from Blink Charging's Q1 report you'd want to know (all changes year over year):
- Revenue: Up 339% to $9.8 million.
- EV charging stations contracted or sold: Up 99% to 3,174 stations.
- Gross margin: 16.2% versus 4% in Q1 2021.
- Net loss: Up 104% to $15.1 million.
That big loss number was a chink in Blink Charging's armor, but the market expected even worse. Overall, it was a record revenue quarter for the company. No surprises, then, that Blink Charging also turned out to be one of the top-performing clean energy stocks this week.
Now what
Ballard Power is the worst-performing stock this week among the three, and rightfully so -- the company's order flow is slow, it's burning cash, and it expects to generate negative gross margin in 2022 versus 15% margin in 2021.
Clean Energy Fuels, on the other hand, has ambitious goals for the next five years: It expects to generate nearly $285 million in profits by 2026, with RNG supply forming the bulk of it. The company, though, is only just getting started on RNG, so it's still a long road ahead.
For that matter, the road ahead for Blink Charging won't be a cakewalk either, but the EV industry is booming and there's exponential growth potential. If Blink Charging can continue growing its revenue triple digits, or even double digits, the EV stock could soon shrug off its weakness from recent months.
