Plug Power Inc (PLUG-Q)

At the heart of debate on hydrogen power. Used in forklifts and such so that the Amazons and Walmarts of the world can reduce carbon footprint. He has a small position in BLDP instead. Both will do well as the market grows and the infrastructure builds out. Accounting issues at PLUG suggest caution.

You need to see BP or Royal Dutch Shell get involved here or else PLUG will tumble, as low as the mid-$20s. Be careful. (PLUG soared 90% last year.)

They just completed a $845 million capital raise. PLUG is the least speculative of the fuel cell plays. In fact, the stock is up since that raise. True, Plug has broken many investors' hearts in the past, floundering for years, but their last report beat the street and customers include Walmart, FedEx, Kroger and Amazon. True, PLUG is still a long way to turning a profit but he enjoys these tailwinds: the Biden presidency will make regulations friendlier to green-energy companies; the price of wind and solar energy keeps getting cheaper; there's a renewable storage problem; and large companies are interested in hydrogen fuel cell power. Japan and Germany are investing in hydrogen power.

Hydrogen fuel cells are the next important energy source in the next 10-20 years, he predicts. Hydrogen could take market share from solar energy and even replace natural gas buildings across America. Hydrogen is clean energy when combined with oxygen and water. Hydrogen could power vehicles and store energy from wind and solar; storage is a problem with renewables, depending on good weather. The technology is not there yet: currently, 9 parts of fossil fuels produce 1 part of hydrogen, so it's inefficient. However, the price of producing "green hydrogen" with renewable energy is coming down. Hydrogen is bulky which is another problem. As the price of solar panels sinks, then the price of hydrogen looks viable. The pure play in hydrogen is Plug. They've been making fuel cells for over 20 years of ups and downs, but now on the right track. They're developing a more efficient forklift and making a hydrogen fuel system to replace old-school acid batteries in industrial trucks. But PLUG has had a huge move in the past year, so buy on a pullback. Their core business is to provide hydrogen fuel cells to forklifts of which they occupy 10% of the market, so there's room to grow. Their technology has already been adopted by Walmart, Home Depot and Amazon. They just signed a pilot program with Linde to test fuel cell engines, and are talking to a big European car maker. It's risky, though, so wait for a cheaper price.