I bought some BLDP today. Financial numbers actually show very positive trend. BUT, can someone tell me what is wrong with this stock. Why is the trend negative since mid July? What piece of the story am I missing here?
The problem with this stock is they promised the world last year 100 mil in revenue if I recall correctly and twice lowered guidance to barely 60 mil. That is a huge failure in guidance. So who really trusts them. Meanwhile they keep diluting shares. So they present guidance for this year conservatively which would be the right thing to have done last year, and the results are baked in.
I own BLDP long and believe in this company due to the patents and customer relationships. One fuel will be the mass utilized future, however long it takes to get there and its hydrogen.
Hydrogen can be derived from many sources solar electrolysis, nuclear to electrolysis, wind to electrolysis, and natural gas steam reforming. The naysayers will say that is inefficient, however hydrogen can be made mobile from stationary sources sounds like a HUGE plus to me. The major benefits will come because there will only be one fuel used by the majority.
It's a good question that I'm not sure anyone can answer, but here are my two cents...
It's not a story stock with high expectations anymore. Ballard has been trying to find a profitable way to introduce, and sell, fuel cell products for 20 years. Now there are many other FC players that have entered the marketplace and taken the high flyer status of Ballard away.
Ballard has a long history of introducing new products only to see a lot of them die from low sales. I don't think the barn-burner product has been discovered that will create the blockbuster demand, so we can only expect an incremental growth plan for now.
Ballard has not seemed to be able to sell a product at a high margin...at least one high enough to show a big swing to profitability.
Ballards earnings growth is simply not growing 'fast enough' to generate excitement fo buyers. It's all about trading for most of the market players right now. You can almost watch, like clockwork, the couple day rise on 'news' or earnings only to have it settle back immediately. The traders know that there is almost no staying power for the stock despite an announcement of any kind.
Many traders/investors see a trend for most of the earnings to come from maintenance contracts rathers than material sales. This is great in the short term, but is not a good business for the long term. Materials sales and repeat sales will be key.
I guess Ballard is not yet technically ready to mass market fuel cells to a world that is not yet ready to mass purchase them. That is my bottom line opinion I keep coming up with. The stock will grow substantially when the profits grow substantially. This seems still many years away based on the current economic situation.
To a point JJ you are spot on with your evaluation, except 2013 has shown that they are actually making substantial moves toward profitability. I do see a major shift in this past year and as new products come online we will see a ramping up of FC sales esp when big high profile companies start getting behind the tech like Toyota. They are already letting journalists drive the FC-R and will reveal it in Tokyo in a couple weeks.