Toyota's Hydrogen Bus Plans Propel FuelCell Energy Stock 9% Higher
Key Ideas
  • FuelCell Energy stock surged 9.3% following news of Toyota's plan to launch a hydrogen fuel cell bus in Turkey in 2025, powered by Toyota modules.
  • The partnership between Toyota and FuelCell Energy suggests technology sharing and potential future collaborations in the hydrogen fuel cell industry.
  • Despite the positive news, concerns about FuelCell Energy's financials, like its lack of profitability and high negative cash flow, raise skepticism about investing in the stock.
  • Investors are advised to consider other stock options recommended by The Motley Fool Stock Advisor team instead of FuelCell Energy for potentially higher returns.
FuelCell Energy's stock saw a significant increase of 9.3% following an announcement from Karsan, a bus manufacturer in Turkey, revealing plans to introduce a hydrogen fuel cell bus powered by Toyota fuel cell modules in 2025. This development emphasized Toyota's growing interest in hydrogen as a fuel source for vehicles, which indirectly benefits FuelCell Energy by validating the fuel cell industry as a whole. The collaboration between Toyota and FuelCell Energy extends beyond the bus project, as earlier in the year, they initiated a 'Tri-gen' production system in Long Beach, California, aimed at producing electricity, water, and hydrogen. This joint venture implies a level of technology exchange between the two companies. Toyota's reliance on FuelCell Energy's technology for hydrogen production indicates a strategic partnership to support Toyota's fuel cell vehicles, including the Mirai FCEV and potentially future models from Karsan. However, despite the positive implications of the Toyota-FuelCell Energy partnership, concerns remain about investing in FuelCell Energy due to its financial performance. The company is currently unprofitable, has limited net cash, and is burning through negative free cash flow annually. These financial challenges raise doubts about the sustainability and growth potential of FuelCell Energy as an investment option. Investors are advised to consider alternative investment opportunities recommended by The Motley Fool Stock Advisor team, which excludes FuelCell Energy. The Stock Advisor service emphasizes identifying high-potential stocks that could offer substantial returns in the future, similar to past success stories like Nvidia. Ultimately, the article serves as a cautionary reminder to thoroughly evaluate investment decisions and consider diverse stock options for optimal returns.
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