Is Ballard Power stock still a buy?

The ride will continue to be bumpy for Ballard Power (Ballard Power Stock Quote, Chart, News TSX:BLDP) but with the ongoing shift to renewable technology the road ahead is looking clearer, says Jamie Murray of the Murray Wealth Group.

“Ballard is a leader in hydrogen fuel cell technology [but] this company has had a couple of false starts over the last 20 years,” said Murray, portfolio manager and head of research for Murray Wealth, who spoke to BNN Bloomberg last Friday.

“You get some excitement and the shares run up and then ultimately nothing really comes out of it and it sort of falls away,” Murray said. “But we're getting the sense that especially with a real push to low or no emission power and energy that the world seems like it's moving to, that governments regardless of the fact that it seems like the technology is now close enough that whether it's solar, electric or hydrogen these are going to be part of our future, and Ballard is the go-to company to invest in that right now.”

Vancouver-based Ballard Power started climbing in 2019, really taking off at the tail end of the year. The company announced in December a raft of new orders for business in China with Weichai Power and in Germany for power company SFC Energy.

The stock returned 73 per cent over the second half of 2019 but the gains so far in 2020 have been even greater, shooting Ballard from $9.28 per share on January 1 to as high as $29.00 by July. The stock has dropped back since but is still close to a double for 2020.

Ballard on Monday announced a fuel cell module for marine vessels, the first on the market, according to the company, which sees uses for its 200-kilowatt modular unit in passenger and car ferries, river push boats, fishing boats and as stationary electrical power generation for cruise ships. It’s part of Ballard’s focus on heavy transportation services including buses, trains and commercial trucks where its hydrogen fuel cells can be employed in extended range and rapid refuelling.

“This is a sweet spot for our fuel cell value proposition, which is backed up by more than 50 million kilometres of operational experience in thousands of vehicles,” said chief commercial officer Rob Campbell in a press release. “These same requirements underpin use cases in the maritime industry, resulting in a significant addressable market opportunity that can be effectively addressed by our new FCwave product. Global efforts to decarbonize include commercial maritime activities, where Ballard intends to build on our leading position in zero-emission fuel cell solutions.”

Ballard pointed out that the United Nations International Maritime Organization currently has a target of 50 per cent reduction in CO2 emissions in the marine sector by 2050. Murray says the worldwide push for more renewable energy usage will likely keep driving Ballard’s share price.

“I think it's going to be a bumpy ride and this is going to be a volatile stock. The expectations are high, but I think the expectations are going to continue to increase and so that should be good for Ballard,” Murray said.

“It's not one that we own right now but it's one that we're starting to look at. It does feel
like we're closer to a hydrogen powered future than, say, ten years ago, so that should be good for Ballard,” Murray said.