Stash This Clean Energy Stock in Your RRSP and Help Disrupt the Auto Industry

Ballard Power Systems Inc. (TSX:BLDP) (NASDAQ:BLDP) continues to disrupt the transportation world, and with the likes of Honda and Toyota investing heavily in the fuel cell, the disruption of the auto industry is fast approaching. Add this stock to your RRSP for long-term explosive gains.

Karen Thomas, MSc, CFA

Karen is a stock market enthusiast focused on uncovering those stocks that she believes the market has mispriced. She does this through fundamental and quantitative analysis of companies and their industries, as well as a study of future opportunities and trends. She holds a Masters degree in Finance, the CFA designation, and has over 20 years of experience in the investment management industry. Having worked at a major pension fund, as well as two leading mutual fund firms as an analyst and portfolio manager, she has solid investing expertise which she aims to share with her readers.

Published June 6, 2019 11:12 am EDT

The market is all abuzz about electric cars and the revolutionary effect that they will on the auto industry. As it should be. Today, with a more than 2% market share globally and growth rates that are easily in double digit territory, electric vehicles are hot — hot enough to consider buying a clean energy, electric vehicle stock for long-term gains within your RRSP.

With this, so is Tesla Motors (NASDAQ: TSLA), a stock that investors have clamored over and an extremely volatile stock that still struggled to turn a profit. Tesla has a seven-year return of 500% and a bright future as it participates in the secular growth trend that has strong tailwinds.

But electric, battery-powered cars are not the only alternative to internal combustion engines.

Fuel cell engines are quickly rising in popularity. These fuel cell engines generate their electricity from hydrogen, the most abundant element in the universe. This light, colourless, odourless, tasteless and non-toxic gas is a clean alternative to the battery powered cars, as their top notch performance stands ahead of electric battery-powered motors.

Fuel cells win the day

Electric battery powered vehicles struggle with such issues as limited driving range, cost, and recharging time to such an extent that some major auto companies don’t see it as a viable alternative to current vehicles. Toyota and Honda have therefore focused on the fuel cell engines to meet the demand for cleaner automobiles.

According to Ballard Power Systems Inc. (TSX: BLDP)(NASDAQ: BLDP) CEO Randy MacEwen, the company is “…seeing early signs of internal combustion engine disruption in heavy and medium duty motive applications, including in bus, commercial truck, rail, and marine. We expect fuel cell electric vehicles to offer a compelling zero-emission value proposition.”

Ballard continues to make progress in supplying buses around the world with fuel cell modules, from Europe to China to Vancouver to California, the demand is there, and the performance of these buses support this demand.

Ballard continues to announce new supply deals, supplying these fuel cell modules to an expanding list of vehicles. From buses to freight trucks to trains, boats and even military drones.

Thus, the future is bright, and I personally have made a bet on it.

While Ballard’s results have been fraught with more financial letdowns, and the most recent quarter (Q1 2019) was no different, we can see the mounting evolution of the fuel cell industry, with key players and governments advancing its place. At least Ballard still has ample cash reserves; with a balance of $165 million as at the end of the quarter, its financial flexibility remains.