WERE FUEL CELLS JUST A BUBBLE?

Hello guys! In this article I’m going to be talking about the fuel cell sector, covering 3 stocks in the sector and why I think the bubble popped on them and why cheaper oil is going to be a killer to the alternative energy sector. Enough on the intro, lets get right into it!

Fuel cells went buck wild last spring when $PLUG, $FCEL and $BLDP just took off on mega epic runs and made a lot of traders a lot of money, including myself. I was a huge supporter of Plug Power over the last year but so much has changed since then for one the price per share has sharply decrees since that epic run. Last month marked the 1 year anniversary and they didn’t do any gift sharing with their shareholders, just further price erosion.

The first stock I’m going to talk about is $PLUG: Plug Power Inc

Where to start… Jump back to last year when $PLUG was trading at $0.68 and almost overnight jumped to $2.20! Many traders thought the run was over, selling for a huge gain, taking the price back down to $1.55. Boy were they wrong! This epic run took shareholders on a wild ride, topping out at $11.75 in a 3 month period. Nobody really knew what $PLUG did or made till after the fact… They were too busy trading it and counting their profits. If you didn’t sell on the way up, you ended up a bag holder, dreaming of a recovery that truly never came.

There were 3 stocks that rock our world for 4 months last year and it was just like sex: great, fast and over before it even started (Not a problem I have). If you didn’t know what to look for or how to trade, you ended up on the loosing side real quick. Let’s break down $PLUG: what they are all about and how Andy Marsh is the biggest joke of a CEO. Andy’s not only a joke, he’s a stupid smoke blowing asshole. Always over promising, never delivering one bit. He’s always talks about how far the company has come in the past 5 years but going forward, they can’t even file on time. On the Jan con[ference] call they said Feb would be the biggest month for them… nothing came of it. They talked about not 1 big retail client but 3 to 4, getting all the shareholders into cheerleader mode with thoughts of Nike and others, helping to keep the pps in the low 3 range but as March passed us by: no news and a huge earnings miss, the stock dropped further, putting us in the mid $2 range. This has new lows written all over it. This isn’t a research report to mislead you into buying this or the other 2 stocks, but more of a statement and calling out Andy. The stock has lost $8 bucks since its huge run and has more bag holders than a supermarket.

The second stock I’m discussing is $FCEL: FuelCell Energy

Aside from the fact that $FCEL ran from $0.90 to $4.70, it’s also a local CT company, which had me cheering for a hometown win. The stock now trades in the $1.20 range, down trending as you can see. Nothing has been going well for them since the run up, requests for grants and other financial support from CT have gone unanswered. I feel this is setting up for an epic crash with a move below the $1 mark in the near future.

The third stock on my list is $BLDP: Ballard Power Systems

Although I feel $BLDP is the best out of the 3 right now, there is still some downside potential before we see a likely recovery. Another epic runner here, from $1.25 to over $8 in a matter of months, but short lived like the other 2, including missing on earnings. During the past 3 months $BLDP has been turning things around with the company and could be in a position to buy out one of the other competitors this year.

I feel the sector has seen its pop and is now done for a while because the price of oil has dropped significantly, the sector isn’t ‘hot’ right now, and solar, my favorite alternative energy, is outdoing fuel cells 10 fold. As I mentioned above, the sector as a whole continues to look bearish, with $BLDP the likely reversal candidate sometime this year. Hope you guys liked my thoughts on the sector. I plan on covering the Solar market next.

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