With the world going green, keep an eye on hydrogen energy stocks.
While you won’t get rich overnight trading them, they could offer explosive opportunities down the line. We already know Bank of America and Goldman Sachs believe hydrogen could create a potential $11 trillion market opportunity. We also know President Joe Biden could ease up on current hydrogen tax credits, which are seen as too restrictive.
In fact, companies, like Plug Power (NASDAQ:PLUG) expect the restrictions to be loosened. According to CEO Andy Marsh, “We do expect the regulations to loosen up. I’ve talked to many senators who tell me it will get easier—not harder,” as quoted by Bloomberg, as I also noted on Jan. 2.
That being said, investors may want to invest in hydrogen energy stocks. These include the following.
Air Products and Chemicals (APD)
With a yield of 2.7%, Air Products and Chemicals (NYSE:APD) is an attractive hydrogen energy stock just below $262. APD appears to have just caught strong support dating back to March, where it typically bounces.
Better, APD is over-extended on RSI, MACD, and Williams’ %R, and could bounce back strong.
Helping, analysts at Citi recently raised their price target on APD to $320 from $295, with a “Buy” rating. Plus, APD also just raised its quarterly dividend to $1.77, payable May 13 to shareholders of record as of April 1. This is now its 42nd consecutive year of increasing that payment.
Air Products Chairman, President and CEO Seifi Ghasemi added, “We remain committed to striking the right balance of returning cash to our shareholders and investing in our growth opportunities. We expect to return approximately $1.6 billion to our shareholders in 2024.”
Chart Industries (GTLS)
Liquid hydrogen storage stock, Chart Industries (NYSE:GTLS) slipped about $9 a share late last week. All after the White House said it would pause approvals of liquefied natural gas exports plants, which impacts GTLS because it makes equipment for those companies.
However, don’t write this hydrogen energy stock off just yet.
As noted by Barron’s, “The projects that could be delayed were unlikely to enter service before 2027, and enough proposals are already under construction that U.S. export capacity is on pace to roughly double by the end of the decade.”
Also, not long ago, analysts at Citi raised their price target on GLTS to $205, with a buy rating. Raymond James also upgraded Chart Industries to a “Strong Buy” rating from Outperform with a price target of $190. The stock looks undervalued even on “deliberately conservative estimates,” as noted by TheFly.com.
Linde (LIN)
The first time I mentioned Linde (NYSE:LIN), it traded at around $350 on April 3. Today, still an undervalued hydrogen stock, it’s up to $404, with a yield of 1.26%. From here, I’d like to see it closer to $480. Helping, Citi recently raised its price target on LIN to $475, with a “Buy” rating.
UBS analysts also listed Linde as having an opportunity for strong structural growth, noting, that Linde is “A market leader in a relatively defensive corner of the chemicals industry and a key enabler of a potential hydrogen transition. Continued demand supports a double-digit EPS growth in its core business,” as quoted by Seeking Alpha.
Morgan Stanley also listed Linde as of one of its 57 quality growth stocks.
The company also increased its liquid hydrogen facility in Alabama, which will now produce up to 30 tons/day of liquid hydrogen, as also noted by Seeking Alpha.
“Additional hydrogen produced at the site will meet the increasing demand for hydrogen from existing and new customers in various end markets, including manufacturing and electronics. Linde said the $90M expansion complements its existing hydrogen business in the southeast U.S. and increases network density in the region,” they added.
On the date of publication, Ian Cooper did not hold (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
