5 Best Hydrogen and Fuel Cell Stocks To Buy

In this article, we discuss the top 5 best hydrogen and fuel cell stocks to buy. If you want to see our detailed analysis of the hydrogen and fuel cell market, check out 11 Best Hydrogen and Fuel Cell Stocks To Buy. 

5. Air Products and Chemicals, Inc. (NYSE:APD)

Number of Hedge Fund Holders: 48

Air Products and Chemicals, Inc. (NYSE:APD) is a provider of atmospheric gasses, process and specialty gasses, including hydrogen and liquid hydrogen. On May 18, Air Products and Chemicals, Inc. (NYSE:APD) declared a $1.75 per share quarterly dividend, in line with previous. The dividend is payable on August 14, to shareholders of record on July 3. It is one of the premier hydrogen stocks to invest in. 

On May 30, TD Cowen analyst Marc Bianchi increased the price target for Air Products and Chemicals, Inc. (NYSE:APD to $385 from $375, while maintaining an Outperform rating on the shares. The analyst cited the second quarter earnings report and guidance, as well as the recent acquisition of Uzbekneftegaz’s Industrial Gas facility for the target raise.

According to Insider Monkey’s first quarter database, 48 hedge funds were bullish on Air Products and Chemicals, Inc. (NYSE:APD), compared to 41 funds in the prior quarter. Phill Gross and Robert Atchinson’s Adage Capital Management is the biggest stakeholder of the company, with 222,340 shares worth $63.8 million. 

ClearBridge Large Cap Value Strategy made the following comment about Air Products and Chemicals, Inc. (NYSE:APD) in its Q4 2022 investor letter:

“In the materials sector, Air Products and Chemicals, Inc. (NYSE:APD)’s ability to recover higher energy costs, particularly in Europe as it continues to execute on its growth projects, has helped it to generate a positive return for the year and made it a strong contributor. The capital APD is deploying into hydrogen products globally is finally getting noticed as Europe is looking to diversify away from Russian natural gas and the Inflation Reduction Act (IRA) benefits domestic investments in renewables, such as APD’s $4.5 billion blue hydrogen project in Louisiana and its $4 billion green hydrogen production facility in Texas. APD is also teaming up with World Energy to build a $2.5 billion sustainable aviation fuel production facility in Southern California, a project that should also benefit from the IRA.”

4. DuPont de Nemours, Inc. (NYSE:DD)

Number of Hedge Fund Holders: 52

DuPont de Nemours, Inc. (NYSE:DD), a multinational chemical company, has been actively working to utilize hydrogen as a clean energy source. On April 19, DuPont de Nemours, Inc. (NYSE:DD) declared a $0.36 per share quarterly dividend, in line with previous. The dividend is distributable on June 15, to shareholders of record on May 31. 

On June 2, Deutsche Bank reaffirmed a Buy rating on DuPont de Nemours, Inc. (NYSE:DD) and set a price target of $80 on the shares. The bank believes that a recent settlement involving PFAS, which includes Chemours and Corteva, removed a significant overhang on DuPont shares.

According to Insider Monkey’s first quarter database, 52 hedge funds were long DuPont de Nemours, Inc. (NYSE:DD), compared to 48 funds in the earlier quarter. Dan Loeb’s Third Point is a prominent stakeholder of the company, with 4 million shares worth $287 million. 

Third Point made the following comment about DuPont de Nemours, Inc. (NYSE:DD) in its Q4 2022 investor letter:

“We recently increased our investment in DuPont de Nemours, Inc. (NYSE:DD), a specialty chemical company run by legendary value creator Ed Breen, who is leading a corporate transformation. In November, DuPont divested its most cyclical and lowest margin business segment, Mobility & Materials, to Celanese for $11 billion, or 14x 2023e EV/EBITDA. Following the divestiture, the improved DuPont trades at 11x 2023e EV/EBITDA, which represents a ~30% discount to its peer group.

We believe the company is laser-focused on closing this gap. First, $5 billion of the proceeds are being deployed to repurchase nearly 15% of its outstanding shares. The next significant catalyst for the stock is a potential settlement of PFAS-related multidistrict litigation in South Carolina, which remains an overhang on the stock even though DuPont’s PFAS liability was largely ring-fenced by the 2021 settlement with Chemours and Corteva. DuPont’s strong management team is eager to demonstrate the business quality of the new portfolio during the current period of economic volatility. We expect the combined catalysts of increased share repurchases, the pending resolution of legal claims, and the new business structure to drive meaningful value for shareholders.”

3. Chevron Corporation (NYSE:CVX)

Number of Hedge Fund Holders: 64

Chevron Corporation (NYSE:CVX) is one of the founding members of the alliance which plans to create a prominent hydrogen hub on the U.S. Gulf Coast. This initiative is known as the HyVelocity Hub, and it aims to engineer diverse infrastructure for hydrogen production and transportation. Justin Kostohryz, Chevron commercial advisor for hydrogen, commented in January 2023: 

“With Texas being a leading producer of natural gas, with extensive infrastructure, geology for carbon sequestration and access to international export facilities, we very much believe the U.S. Gulf Coast is positioned well for a hydrogen hub.”

On June 1, RBC Capital upgraded Chevron Corporation (NYSE:CVX) to Outperform, raising the price target from $165 to $180. The analyst noted Chevron’s successful utilization of its premium valuation to acquire companies, citing the recent acquisition of PDC Energy as an example. RBC believes Chevron’s strategic approach and financial stability will reap long-term defensive benefits.

According to Insider Monkey’s first quarter database, 64 hedge funds were bullish on Chevron Corporation (NYSE:CVX), compared to 57 funds in the prior quarter. Warren Buffett’s Berkshire Hathaway is the largest stakeholder of the company. 

Carillon Tower Advisers made the following comment about Chevron Corporation (NYSE:CVX) in its Q4 2022 investor letter:

“Energy performed well during the fourth quarter, with the sector up about 23%. Investors returned to the sector after the Organization of the Petroleum Exporting Countries (OPEC) signaled it would reduce production. Chevron Corporation (NYSE:CVX) reported strong quarterly results while buying back stock, paying a healthy dividend, and maintaining a strong balance sheet.”

2. Linde plc (NYSE:LIN)

Number of Hedge Fund Holders: 70

Linde plc (NYSE:LIN) is an industrial gas company that provides oxygen, nitrogen, argon, carbon dioxide, helium, and hydrogen, among others. Linde plc (NYSE:LIN) is one of the best hydrogen stocks to invest in. On April 24, the company declared a $1.275 per share quarterly dividend, in line with previous. The dividend is payable on June 16, to shareholders of record on June 2. 

On May 12, Berenberg raised its price target on Linde plc (NYSE:LIN) to $415 from $375, while maintaining a Buy rating on the shares. According to the firm, Linde is prioritizing the “take-or-pay” model for industrial gas volumes, leaning towards stability over taking on price risks associated with clean hydrogen or ammonia. The current primary business of Linde is performing strongly, Berenberg wrote in a research note to investors.

According to Insider Monkey’s first quarter database, 70 hedge funds were bullish on Linde plc (NYSE:LIN), compared to 56 funds in the earlier quarter. 

Madison Funds made the following comment about Linde plc (NYSE:LIN) in its fourth quarter 2022 investor letter:

“Linde plc (NYSE:LIN) stock was strong during the fourth quarter following a solid third quarter. Linde remains well positioned with the passage of the Inflation Reduction Act and energy transition with carbon dioxide sequestration opportunities, gasification services, and various hydrogen projects. Linde and Schlumberger announced that they entered into a collaboration of carbon capture, utilization, and sequestration (CCUS) projects to accelerate decarbonization solutions across industrial and energy sectors. The collaboration will combine decades of experience in carbon dioxide capture and sequestration. The collaboration will focus on hydrogen and ammonia production where carbon dioxide is a by-product. The International Energy Agency estimates that 6 Gigatons of carbon dioxide will need to be abated with CCUS in order to reach net zero by 2050. During the quarter, Linde also announced that it became a signatory to the United Nations Global Compact (UNGC), the world’s largest corporate sustainability initiative. As a signatory, Linde has committed to aligning its strategy and activities with the UNGC’s Ten Principles across human rights, labor, environment, and anti-corruption.”

1. Exxon Mobil Corporation (NYSE:XOM)

Number of Hedge Fund Holders: 73

Exxon Mobil Corporation (NYSE:XOM), the American oil and gas giant, is set to enter the hydrogen space by manufacturing a world-class blue hydrogen plant at its Texas refining and petrochemical complex. Along with carbon capture and storage, blue hydrogen will result in lower emissions across Exxon Mobil Corporation (NYSE:XOM)’s operations. It is one of the top hydrogen stocks to watch. 

The company’s net income more than doubled to $11.43 billion in the first quarter of 2022 and oil and gas net production equaled 3.83 million boe/day, up 4.2% on a year-over-year basis. The company also raised and extended its share repurchase program, adding up to $35 billion in repurchasing capacity during 2023-2024.

According to Insider Monkey’s first quarter database, 73 hedge funds were bullish on  Exxon Mobil Corporation (NYSE:XOM), compared to 79 funds in the earlier quarter. Rajiv Jain’s GQG Partners is the largest stakeholder in the company, with a position worth $2.14 billion. 

Here is what First Eagle Investments had to say about Exxon Mobil Corporation (NYSE:XOM) in its second-quarter 2022 investor letter:

“Integrated oil and gas giant Exxon Mobil performed well in the second quarter as continued high prices for energy products supported the stock. As the largest refiner in the US, the company has benefitted from wide “crack spreads,” or the margin between the cost of crude oil and the petroleum products extracted from it. Exxon continues to invest in refining capacity in the US, which industry wide has been in steady decline since 2019. We are pleased that Exxon has been using its strong cash flows to reduce debt and to return cash to shareholders through dividends and stock repurchases.”

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