Ballard Power Systems CEO Randy McEwen outlined risks related to the upcoming U.S. presidential election and policy uncertainty in Europe and China. (Associated Press/Richard Drew) (Associated Press)
Ballard Power Systems Inc. (BLDP.TO) (BLDP) shares recovered from a drop following Monday’s earnings release, closing up 6.77% on Tuesday.
The Toronto-listed stock rose 7.57 percent to close at $2.68 in trading on Tuesday. Ballard’s shares were down about 6 percent on Monday.
The recovery ignored a downgrade by CIBC Capital Markets, with analysts warning that “high uncertainty” about hydrogen’s future is set to become even more uncertain in the coming months.
The Vancouver-based fuel cell maker reported second-quarter results Monday that included a sharp drop in customer orders and plans to cut spending in response to slower-than-expected adoption. CEO Randy McEwen said sales would be concentrated in the second half of 2024 and warned of “variability” from quarter to quarter for the time being.
McEwen also outlined risks related to the upcoming U.S. presidential election and policy uncertainty in Europe and China to equity analysts on Monday.
CIBC Capital Markets analyst Krista Friesen downgraded Ballard’s Nasdaq-listed shares to “underperform” and more than halved her price target to $1.60 from $3.50.
“We believe we are operating smoothly and achieving key product milestones, however the macro environment is becoming increasingly less supportive of hydrogen adoption and the upcoming U.S. presidential election brings further uncertainty,” she wrote in a client note.
“If Republicans win in November, I think they’ll have a hard time getting back the funds that have already been allocated, but any spending or deductions currently being discussed will likely face a pretty uphill battle.”
For example, Ballard noted that discussions are still ongoing over the 45V clean hydrogen tax credit, despite guidance issued by the Treasury Department and Internal Revenue Service in December.
Jeff Lagerquist is a senior reporter for Yahoo Finance Canada. Follow him on Twitter. Jeff Lagerquist.
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