Stocks to buy

Ride the Green Wave With These 3 Top Hydrogen Stocks

The push to save the world from harmful pollutants is only going to grow in the coming years. Programs by governments across the world are causing industries to make the most of this opportunity. However, this is not something that can be achieved overnight. It will take a lot of time and effort for the countries to achieve their goals. 

To achieve net zero emissions by 2050, the government is seeing a demand for hydrogen fuel cells and electrolytes. The Department of Energy’s $1 billion plan to encourage clean hydrogen usage could give a boost to several hydrogen companies. Now is the right time to start investing in hydrogen stocks to make the most of the opportunity. Let’s take a look at the top hydrogen stocks to buy now.

Bloom Energy (BE)

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One of the top hydrogen stocks to buy is Bloom Energy (NYSE:BE). Despite some skepticism over the company’s potential, it has certainly made a name for itself in the hydrogen industry. Bloom Energy specializes in hydrogen fuel cells, microgrid energy solutions and electrolyzers, and gained attention for its solid oxide fuel cell technology. This technology can be used in manufacturing, retail, healthcare and data center industry. The company recently launched a net zero solution for heating and cooling which can be used in the commercial sector to reduce energy costs. 

Bloom Energy saw a 24% year-over-year rise in revenue in the second quarter and hit $301 million. It managed to increase the turnover through the product and service revenue which grew by 21% in the quarter. It also saw a strong improvement in the gross margin and reduced its net loss to $66 million from the loss of $118 million in the same quarter the previous year. Bloom Energy is moving in the right direction and we could see the business report a profit in 2024. 

The company managed to achieve a year-over-year decline in product costs which led to an improved margin this quarter. For Bloom Energy, this is only the beginning. As the demand for hydrogen continues to grow, it is set to gain. This is one of the top hydrogen stocks to buy and hold for the next few years. BE stock is trading at $15 today and is down 34% in the past six months. This is your chance to make the most of the discount. The stock is much lower than the 52-week high of $31 and this implies a high upside potential. If you buy and hold the stock, it can double your money.

Plug Power (PLUG)

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Plug Power (NASDAQ:PLUG) recently opened the gigafactory in Rochester for visitors, and is the largest fuel and cell and electrolyzer plant today. This factory will help management achieve the annual revenue goals of $1.4 billion this year and $20 billion by the end of this quarter. Many believe that this is an ambitious goal and yes, the targets are huge. The company generated $701 million in revenue in 2022 and $210 million in the first quarter of 2023. By 2030, the management aims to generate a 35% gross margin and 20% operating margin. 

The company has the potential to deliver on its projections but I am not certain about its timeline. Plug Power has been in the business for more than two decades but has not been able to make money. While it expects to double its revenue and see a whopping rise in the gross margin, nothing can be certain. However, the stock is still worth your consideration. Even if you leave the numbers aside, Plug Power enjoys high demand due to the ongoing incentives and awareness about hydrogen fuel cells.

PLUG stock is trading at $10.91 today and is much lower than the 52-week high of $31. This drop in the stock price is a good chance to load up. Even if the company manages to achieve half of the projections, you will be able to enjoy solid returns on the stock. The company reports earnings on August 9.

Linde (LIN)

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Linde (NYSE:LIN) is a solid and must-buy hydrogen stock . The company is a major supplier of the electrolyzers that are used for the production of green hydrogen and it is already supplying green hydrogen to Dow’s (NYSE:DOW) plastics plant. In the recent quarter, it reported sales of $8.2 billion and a 15% rise in the operating profit.

Its EPS came in at $3.19 and the company increased its full-year EPS guidance to $13.80 – $14.00, which is a 12% to 14% year-over-year growth. The company has enough cash flow to help with sales and investments in the coming months. It has seen an increase in sales across different regions of the world and this has led to a rise in operating profit. 

Analysts are highly optimistic about the future of the stock. HSBC has a price target of $440 with a buy rating while Argus Research has a price target of $463. BMO Capital has a price target of $418 and Wells Fargo has a price target of $444 with an overweight rating.

LIN stock is currently trading at $381.78 and is up 19.92% year to date. It is soaring closer to the 52-week high of $393 and could easily hit $400 very soon. Considering the positive sentiment around the stock, there is a high potential for it to reach new highs in the near term. It is one of the high-potential hydrogen stocks to add to your portfolio. 

On the date of publication, Vandita Jadeja did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Vandita Jadeja is a CPA and a freelance financial copywriter who loves to read and write about stocks. She believes in buying and holding for long term gains. Her knowledge of words and numbers helps her write clear stock analysis.