Ballard Power stock sinks to fresh 52-week low, after 10% post-earnings plunge

Vancouver-based Ballard sells hydrogen fuel cells for buses, commercial trucks, trains, marine vessels, and stationary power. (GETTY) (koiguo via Getty Images)

Shares of Ballard Power Systems (BLDP.TO)(BLDP) fell sharply again on Tuesday, following a more than 10 per cent drop in yesterday’s session as the Canadian fuel cell-maker reported financial results.

Vancouver-based Ballard builds hydrogen fuel cells for buses, commercial trucks, trains, marine vessels, and stationary power. Its partners include Canadian Pacific Kansas City (CP.TO)(CP) rail, Ford's (F) heavy truck division, and Winnipeg-based bus maker NFI Group (NFI.TO).

On Monday, Ballard reported a $48.9 million net loss for the fourth quarter of 2023, more than 77 per cent larger than a year ago. While Q4 revenue rose about 25 per cent year-over-year, analysts have reacted negatively to an approximately eight per cent drop in Ballard’s 12-month backlog of orders from customers. They also cite uncertainties around hydrogen adoption, and Ballard’s timeline for turning a profit.

BMO Capital Markets and CIBC Capital Markets cut their respective price targets on Ballard shares on Tuesday. CIBC’s Krista Friesen lowered her estimate to US$3.75 per share, from US$5, for the company’s NASDAQ-listed stock. BMO’s Ameet Thakkar dropped his price target to US$3 per share.

"We think the shrinking backlog and order book surprised many investors, and it continues to put downward pressure on 2024 revenue," Thakkar wrote in a note to clients.

CIBC maintains a “neutral" rating, while BMO rates the stock at “underperform.”

Ballard's Toronto and NASDAQ-listed shares fell to new 52-week lows on Tuesday, losing over five per cent in early afternoon trading.

Ballard says its 12-month order book was worth $66.6 million at the end of the fourth quarter. The company says a $6.1 million year-over-year decrease was the result of record engine shipments, plus the removal of $19.4 million in previous orders from a “specific customer experiencing financing and program delays.”

“I characterize [it] very much as a one-off,” Ballard CEO Randy MacEwen told analysts on a post-earnings conference call on Monday. “This is a situation that is unfortunate, but we are working with that customer, expecting to get back on track here in 2024.”

Jeff Lagerquist is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jefflagerquist.

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