Momentum seekers in the market can’t help but look to Bitcoin for wealth these days. This cryptocurrency and others even related to the industry have seen massive growth in the past few months. After a year of growth in 2020 for many tech stocks, investors want that same rush they got last year.
But if you’re looking to Bitcoin, it’s a risk. The valuation simply rides on what people believe its value to be. This is why Warren Buffett and others aren’t exactly on the side of Bitcoin.
Even still, it looks like the future is headed that way. However, if you’re wanting less risk but plenty of rewards, there’s another stock I would consider before Bitcoin.
Ballard over Bitcoin
While it might not be as sexy as Bitcoin or even electric vehicle (EV) companies like Tesla, Ballard Power Systems (TSX:BLDP)(NASDAQ:BLDP) has finally hit its stride. The company and its hydrogen fuel cell technology aren’t looking to take over the personal vehicle industry. Instead, it’s looking bigger.
Ballard Power hopes to become the go-to for trucking, municipal transit buses, railways, and shipping in the new EV age. Hydrogen power can apply more than 60% of energy to vehicle propulsion. And it looks like the company has finally got that chance.
The company already has several large partnerships with companies like Ford and Daimler AG. These companies alone have invested millions into Ballard. However, with Tesla available shares in the company slumped until recently. Ballard stock instead switched gears to heavy-duty vehicles. It’s this avenue that should create major revenue now.
There are about four million commercial truck sales each year around the world. Nearly half of them are in China. The immense growth in this country leaves opportunities for companies like Ballard. That’s especially as China is also the largest consumer and producer of EVs.
Ballard already secured a $163 million deal with Weichai Power Co. back in 2018, becoming its largest shareholder with 15% stake in the company. But that investment has paid back huge with a joint venture that commissioned the production of 20,000 hydrogen fuel cell stacks per year.
As of 2020, China accounts for US$54.2 million of Ballard’s US$103.8 million in revenues. But now the company is seeking the same growth in Europe as the next opportunity. This area currently takes up US$36.4 million of the company’s revenue.
Bitcoin may be booming, but there are plenty of opportunities left for Ballard, as the company continues to expand. In fact, the biggest opportunity is still underway. Ballard recently made a deal to provide six hydrogen fuel cells for Canadian Pacific Railway. Should this deal turn fruitful, which it should, replacing diesel-powered vehicles with hydrogen fuel cells could be worth $4 billion worldwide by 2030, according to estimates.
And again, this would lead to even more expansion throughout the world in the railway industry. Expansion the company has already seen lead to a market share in China, Europe, and North America. While future growth could lead to some losses in the short term, management believes long-term investors will be handsomely rewarded.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Amy Legate-Wolfe owns shares of Canadian Pacific Railway Limited. David Gardner owns shares of Tesla. Tom Gardner owns shares of Tesla. The Motley Fool owns shares of and recommends Tesla.