Investment bank Morgan Stanley has selected a top pick for hydrogen stocks, saying that the energy conversion to hydrogen is accelerating amid the recent surge in international oil prices from Russia.
According to CNBC on the 30th (local time), Morgan Stanley said, “As the red light on energy security is lit up, such as international oil prices soaring due to Russia’s invasion of Ukraine, countries are making efforts to switch to energy. Through this government subsidy, etc., it will grow rapidly.”
Recently, the European Union (EU) has decided to increase green hydrogen production to 20 million tons per year by 2030, four times the existing target. Green hydrogen refers to eco-friendly hydrogen produced by decomposing water using electricity generated from renewable energy such as solar or wind power.
The United States also cited hydrogen as the next-generation core energy source. On the 28th, at the Global Energy Forum hosted by the think tank Atlantic Council, Assistant Secretary of State for Energy Conversion Anna Spitzberg said, “Hydrogen is a versatile game changer that can supplement nuclear power and natural gas. We will support for it,” he said.
As the top pick for hydrogen stocks, Plug Power, a hydrogen company, Exxon Mobil, an oil refining company, and Air Products & Chemicals, a chemical company, were selected. Plug Power occupies 95% of the hydrogen forklift market in the US, and is evaluated as a leading company in the hydrogen market. According to Morgan Stanley, the field where green hydrogen is currently used the most is the truck and forklift industry, with a market size of about $30 billion.
Morgan Stanley analyst Steven Bird said, “PlugPower is reducing costs through its long-standing know-how in the hydrogen fuel cell market, and as a result, a ‘virtuous cycle’ is being formed that leads to greater sales.” set Plug Power’s revenue last year was $502 million, up 636% from the previous year. The stock is down 57% from its peak in January last year.
Although ExxonMobil’s current share price is overvalued, the outlook is bright as it has decided to invest more than $15 billion in clean energy, including hydrogen, over six years. Morgan Stanley said, “In the case of ExxonMobil, hydrogen projects are underway in the United States, Canada, and the Netherlands, and as a giant energy company, it has the technological capability to make the project a success.”
Air Products & Chemicals received an overweight rating with an investment rating as it has strengths in the production of blue hydrogen made from natural gas, etc. Blue hydrogen is expected to be widely used in industrial fields until green hydrogen is commercialized in earnest.
By Maeng Jin-gyu, staff reporter maeng@hankyung.com
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