The world, in its eternal quest for greener pastures, has set its sights on the lofty goal of achieving Net Zero Emission by 2050. Reflecting this aspiration, hydrogen has emerged as a beacon of hope in the clean energy landscape, offering a promising alternative to traditional fossil fuels. For shrewd investors looking to ride the wave of change, the time to invest in hydrogen stocks is now—while the iron is still hot.
Linde PLC (LIN)
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Indeed, when it comes to dominating the global stage in the industrial gas sector, Linde PLC (NASDAQ:LIN) stands head and shoulders above the rest. Renowned for producing a myriad of gases vital to numerous industries worldwide—ranging from oxygen and nitrogen to carbon dioxide and hydrogen—Linde Plc has cemented its position as an industry stalwart.
As a testament to its prowess, Linde’s subsidiary, White Martins, is gearing up to construct a second green hydrogen electrolyzer plant in Brazil. A five-megawatt marvel, this plant will harness renewable energy sources to serve clients like glass manufacturer Cebrace and other industrial titans, starting in 2025.
While Linde’s 2023 performance may have seemed like a mixed bag—a 2% dip in revenue offset by a surge in net income to $6.2 billion from the previous year’s $4.1 billion—its stock paints a rosy picture. Sporting a trailing twelve-month P/E ratio of 31.37x, slightly elevated but within reason, complemented by an impressive 53.01% 1-year basic EPS growth, Linde’s trajectory seems nothing short of promising.
New Fortress Energy (NFE)
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In the realm of integrated gas-to-power infrastructure, few names evoke as much investor fervor as New Fortress Energy (NASDAQ:NFE). With a focus on Terminals & Infrastructure and Ships, this company excels in natural gas and hydrogen procurement, liquefaction, shipping and logistics, as well as the development of natural gas-fired power generation.
Anticipating the surge in demand for clean energy solutions worldwide, New Fortress Energy has been proactive in expanding its footprint, from Jamaica and Puerto Rico to Mexico. In a bid to meet this escalating demand head-on, the company recently clinched a significant milestone—the acquisition of a 1.6 GW Capacity Reserve Contract. Moreover, by embarking on the construction of a power plant in Brazil, New Fortress Energy aims to rake in annual fixed capacity payments of $280 million for the next 15 years—courtesy of the contract terms.
Although New Fortress Energy’s financial year 2023 results may have presented a mixed bag—revenue swelling from $2.37 billion to $2.41 billion, propelling basic EPS to $2.66 per share, a remarkable 186.02% year-over-year growth—the stock’s trailing twelve-month P/E ratio of 9.90x appears enticingly affordable.
The Rise and Shine of BP PLC in the Energy Sector
The Hydrogen Powerhouse
BP PLC (NYSE:BP) emerges as a key player in the energy sector, standing tall as a global giant that dabbles not only in hydrogen but also in various other business segments. The company’s expansive portfolio includes natural gas, crude oil, renewable energy products, and energy marketing. Furthermore, BP is actively investing in cutting-edge, low-carbon solutions such as hydrogen, carbon capture and storage, wind power, and electric vehicle charging.
Conquering New Frontiers
Fueling its growth trajectory, BP PLC recently celebrated the commencement of oil production from its state-of-the-art $6 billion offshore platform, Azeri Central East, located in Azerbaijan. This milestone marked the addition of the seventh platform in the Azeri-Chirag-Gunashli field. The company forecasts the new project to process thousands of barrels per day and aims to yield 300 million barrels over its operational lifespan, a development set to bolster Azerbaijan’s oil production landscape.
A Beacon of Profitability
Noteworthy in BP’s year-end performance report is a remarkable $15.2 billion profit, underscoring a staggering 1-year EPS growth of 767.09%. The company boasts of a trailing twelve months (ttm) P/E ratio of 8.10x, which emerges as the most economical among all hydrogen stocks in the industry. Analysts have given BP stock a vote of confidence, maintaining a favorable buy rating based on its financial performance and strategic positioning.