The Globe and Mail reports in its Monday edition that an asset bubble in hydrogen-fuel-related stocks is rapidly inflating. The Globe's Scott Barlow writes that the Solactive World Hydrogen Index of companies related to the theme is higher by 118 per cent since inception less than six months ago.
The long-term outlook for the hydrogen molecule as a near-bottomless source of green energy is indeed promising, but cost-competitive hydrogen energy is at least five years away.
The extended time frame for viable green hydrogen means investors are currently pouring money into companies that will not be profitable or even have revenue in many cases for many years. Wall Street is doing all it can to stoke investor interest in hydrogen-related investments. Recent returns for the companies in the index have been remarkable – the index has doubled in value over the past three months. Standouts include U.S.-traded Plug Power and Bloom Energy, Britain's ITM Power PLC and Norway's Nel ASA. Canada's Ballard Power Systems, higher by just less than 200 per cent over the past 12 months, is also in the index.
Mr. Barlow thinks the smart thing to do for most investors is to stand by and watch as the hydrogen bubble builds.
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