Here’s Why Ballard Power (BLDP) Stock Is Skyrocketing Today

Ballard Power (BLDP) stock is spiking on Monday afternoon after the company signed a deal with Guangdong Nation Synergy for a fuel cell stack production operation in Yunfu, China.
By Kaya Yurieff ,

NEW YORK (TheStreet) -- Shares of Ballard Power Systems (BLDP) - Get Report are surging 41.73% to $1.97 on heavy trading volume late Monday afternoon after the company signed an agreement with Guangdong Nation Synergy Hydrogen Power Technology for a fuel cell stack production operation in Yunfu, China.

The fuel cell stacks will be packaged into locally-assembled fuel cell engines and integrated into zero-emission buses and commercial vehicles in China, according to a company statement.

China is the world's largest producer of greenhouse gases, according to Bloomberg.

Over five years, the deal has a contemplated minimum value to Ballard of $168 million.

The agreement highlights rising interest in fuel cells, which produce electricity through a chemical reaction and have low carbon emissions, Bloomberg noted.

The transaction is expected to close late this year, at which time a joint venture will be created to undertake the stack manufacturing operations. The venture will be owned 90% by Synergy and 10% by Ballard.

Ballard will receive $18.4 million in revenue for technology transfer services and commissioning support and $150 million in sales of products based on a "take or pay" contract that ends in 2021.

Burnaby, Canada-based Ballard is engaged in the design, development, manufacture, sale and service of fuel cell products.

About 16.72 million of the company's shares changed hands by late this afternoon vs. its average volume of 597,069 shares per day.

Separately, TheStreet Ratings Team has a "Sell" rating with a score of D on the stock.

The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow, poor profit margins and generally disappointing historical performance in the stock itself.

Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

You can view the full analysis from the report here: BLDP

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