3 Shades of Hydrogen, High on Hyliion and Aphria Holdouts
The Truth About Hydrogen
It’s Thursday, y’all! Time to bask in Great Stuff Reader Feedback’s warm glowing warming glow … or something.
I have quite the list to get through today, so let’s keep this brief. If you want to join us next week, drop us a line at GreatStuffToday@BanyanHill.com. As you’ll see, we take all kinds of questions here — it’s all green, blue and gray to us.
All right, let’s get to our featured presentation of the day:
Thanks for writing in, David! You aren’t the only Great One asking hydrogen questions this week. Jared K., David H., Steve T. … the list goes on.
And Steve T., I appreciate that you’re doing your homework on hydrogen, but I’m not going to rebut a competitor’s newsletter point by point. As fun and as tempting as that would be, it’s just … umm … unprofessional?
Anyway, your main concerns seem to revolve around hydrogen’s “greenness” and its cost. Let’s start by talking about the hydrogen rainbow. OK, it’s not much of a rainbow, per se … there are only three colors of hydrogen:
This is the most common type of hydrogen on the market. Made from natural gas and methane, it’s the cheapest to produce, but it’s also the dirtiest. That said, it’s still greener than coal, gasoline, diesel and other fuel types. Hydrogen fuel cells only emit water vapor and not additional CO2 or other harmful gasses.
Think of gray hydrogen as a transitional crutch for Big Oil to wean itself off … well, oil.
This fancy-schmancy term is simply gray hydrogen made with carbon-capture technology. It’s more expensive than standard gray hydrogen simply due to the cost of carbon capture. Blue hydrogen is greener and takes us one step further along the transition away from traditional carbon-based fuels.
As the name implies, this is true green energy. Green hydrogen is created by electrolysis — i.e., using electricity to separate water into hydrogen and oxygen. H2Ooh! This method is the costliest and least efficient. Furthermore, depending on how you produce the electricity, it can be not quite “green.”
I’m not going to lie to you. Right now, hydrogen is not the cheapest nor the most efficient green energy on the market. That crown goes to wind power, I believe.
But hydrogen does have the biggest potential. Hydrogen accomplishes everything that oil currently boasts in ease of use, power efficiency (once it’s extracted), portability and power generation.
Right now, producing gray hydrogen releases essentially the same CO2 and other harmful gasses that traditional fossil fuels do. This is true. However, grey hydrogen reduces emissions for the end user — such as your car, SUV, semitrucks, etc.
In short, there is a green advantage to using this dirty form of hydrogen.
The best part is that both grey hydrogen and the fuel cells necessary to power everything from power plants to electric vehicles (EVs) are available right now. Not years down the road — I’m looking at that particular competitor’s report, Steve, that pushes nuclear fusion. (It’s a great idea, and I’ll be all for it … when it’s ready for prime time in 20 years.)
But hydrogen is ready now. Furthermore, by combining electrolysis with solar, wind, geothermal and other green methods, true green hydrogen is already making inroads into the market.
The companies that Great Stuff Picks recommends are actively working toward this goal. They’re improving hydrogen efficiencies and bringing down the cost of true green hydrogen. It’s the hydrogen mega trend, and it’s only going to grow.
Ditch the Excuses
But solar, wind, etc., don’t make enough electricity to power EVs right now! Your argument is invalid!
Yeah. It’s sad that the U.S. doesn’t have more renewable energy sources; I’ll give you that. But 47 countries currently get more than half of their energy from renewables. Five of those operate on 100% renewable energy: Albania, Congo, Iceland, Paraguay and Namibia.
And if you’re looking for bigger countries with more comparable industrial production and energy demands, Germany currently gets 46% of its energy from renewables — with solar making up 18% of that. And we all know how sunny Germany is…
At this point, we’re just arguing national energy policy, and this is an investing newsletter.
The market is only just starting to demand more renewable energy in the U.S., and this is a growing section of the energy market. It’s nothing short of a new energy revolution, and hydrogen is a critical factor in a multi-pronged approach.
The bottom line is that hydrogen energy technology is here now. It works with American conveniences, like filling up at the pump. It’s transitional — it’s Big Oil’s easy in on the green movement. And even dirty hydrogen is greener than traditional fuel sources.
But, hey … it’s your portfolio. Your investing dime. You do you. Thanks for coming to my Ted Talk.
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I hope you enjoyed that commercial break. Now back to the mailbag…
Thank you to Pat, Larry and the seemingly dozens of Davids who wrote in this week. Apparently, investors named “David” are our key demographic. Who knew?
If you don’t see your email below, you might’ve cursed too much for the powers that be, and we can’t publish that $#!& around here.
Or … hear me out on this one … maybe you didn’t write to us at all! Let’s fix that, shall we? Drop us a line at GreatStuffToday@BanyanHill.com anytime you get the inspiration to rant and rave away.
With that, to the inbox!
That’s right: We’re not out of the new energy woods yet. Though switching gears from hydrogen to talk about battery tech … it’s like talking about streaming Netflix, and someone brings up their LaserDisc collection. No offense, Pat.
It’s just that batteries are the “now” and hydrogen in the future (see above).
Now, reading through Hyliion’s (NYSE: HYLN) press release on the battery doesn’t exactly thrill me, and I understand why HYLN didn’t react much on the news. That touted “eight-minute charge time,” for starters. Are we talking a full recharge? Or just enough to wet the whistle? And how big of a battery are we recharging? What’s the range?
I feel that if Hyliion meant “fully recharged in eight minutes,” it would’ve said so. That kind of charging speed would turn every non-hydrogen EV maker upside down.
Why isn’t Hyliion bragging it up, then? Reading between the lines of EV marketing, this means eight minutes is likely not for a full charge. And the short story is that, while improving existing battery cell tech … this is still battery cell tech.
Sure, Hyliion’ better than what’s out there (especially when you consider Hyliion’s targeting larger trucks), but is it game-changing? It remains to be seen. That’s more what Hyzon is doing — moving away from battery reliance altogether.
Now, some self-critical part of me wants to remind you that we’re not battery experts here, by any means. But I do know when there’s hype without fire — er, smoke without hype. You know what I mean.
That’s to say, everyone thinks their new shtick is a game-changer. Why do you think I named this Great Stuff after all?
Ah Yes, Those Reddit Folks Again
Can’t get enough Great Stuff!!!
I usually spend the first five or six hours each morning studying (and sometimes investing) in the markets with the aid of a bunch of coffee. I always save the Great Stuff email until the very last. Your humorous outlooks on the market, along with memes and crazy song lyrics, makes my day brighter. Thanks, Joseph!!!
Your reply to Gadu in Thursday’s Reader Feedback caught my attention. I was able to get some Aphria at $5 and was happy to see it rising until I saw that the Reddit folks were the reason. I was planning to hold until this spring’s merger with Tilray, but now I’m not so sure after you told Gadu to take some profits.
Do you think the Reddit fever will be over before the merger, and should I wait until then? Thanks for your lighthearted look on almost everything under the sun!!!
— Larry C.
Thanks for writing in, Larry!
Now, you mean to tell me that you saw your stake in Aphria (Nasdaq: APHA) soar upwards of 400% to a new all-time high … braved the ensuing sell-off … and still want to hold until the spring merger? You mad dog, you!
I have to ask you the same question I posed to Gadu in last week’s Reader Feedback: Do you want right-now profits or long-term profits? You already have the former, and if Gadu’s gains made you consider taking profits … you’ve already blown their gains out of the water as well.
You staying in APHA depends on how much you believe in a combined Aphria and Tilray (Nasdaq: TLRY). If you didn’t have your target (and expectations) set before buying into APHA, keep how you’re feeling right now in mind before you place your next trade!
Now, taking profits off the table never has to be an either/or type of decision. They are not mutually exclusive. Score for the indecisive people, yeah!
You can always close out part of your position to make sure you get a profit. Then, you get to sit back and watch what happens with APHA with only house money on the line. The rest, as I told Gadu, is up to you. Everyone’s way to play APHA will be different.
For instance, on January 15, Rebound Profit Trader readers were instructed to sell and take profits on APHA for a 342% gain after only five months!
On January 27, they were told to sell FSLY for a gain of 104% in just 28 days. And on February 10, readers were instructed to sell CGC and take 493% gains after six months. This strategy has brought readers a 100% win rate this year!
Aren’t we all, David. I’m told the truth is out there, but alas, no dice.
Ma’am, this is an email inbox … and judging from the rest of your email (unpublished on purpose), not the one you’re looking for. Waves hand. Move along. Move along.
Thanks for the kind words! And I’m not crazy — my mother had me tested. However, if you’d like to send money anyway, my Venmo is [Redacted].
You’re … you’re already here, Dave. Though, if you’re looking to pass the Great Stuff to your own personal mailing list, well, I won’t stand in your way!
If you’re looking to share the Greatness with your friends, it’s easy for anyone to sign up. Just click here! Remember what Mr. Great Stuff always says: Like Stuff? Share Stuff! So be sure to share ‘Stuff with everyone right down your email list. Send it all!
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Until next time, stay Great!
Editor, Great Stuff
I’ve been investing for more than 25 years. I started my career on Wall Street in 1991 as an assistant portfolio manager at Bankers Trust. I quickly advanced to prominent positions at Deutsche Bank and ING, managing multimillion-dollar accounts. In 2006, the owners of a $6 billion firm named Kinetics Asset Management recruited me to manage their hedge fund.