Thursday, November 8, 2012

Ballard Power Systems Inc 2

I do not own this stock of Ballard Power Systems Inc. (TSX-BLD, NASDAQ-BLDP), but I used to. This stock was one of a number of stocks I bought in the late 1990's to get a basket full of small cap stocks. I bought a number of small caps, but I never made money on any of them. The main problem was the bear market that occurred in the 2000. None of my stock recovered from that.

There is a minimal amount of insider selling according to the insider trading report. There is not insider buying. Everyone has more options than shares. Not only are there options, but there are Deferred Share Units, Restricted Share Units, Units Deferred Share Units and Units Restricted Share Units.

NASDAQ says that as of September 30. 2012, 45 institutions hold 5.62% of the shares of this company, and shares have increased by 18% over the past year.

I can reach not conclusion on stock price using Price/Earnings because there are not earnings. This also presents a problem for Graham No. as this number is based partly on earnings also.

The 10 year median Price/Book Value per Share Ratio is 1.19. The current Ratio is 0.77. This current ratio is only some 65% of the 10 year median Ratio and this low ratio suggests a cheap stock price. The ratio being under 1.00 also suggests a cheap stock price. (This is because stock is selling lower than the book value.)

The 5 year median Price/Sales Ratio is 3.57. The current P/S Ratio is just 0.88. This low current ratio suggests the stock price is cheap. The P/S Ratio being below 1.00 also suggests a good stock price. (Often analysts look at P/S Ratio on companies that are not earning any profits to help decide if the stock price is appropriate.)

When I look at analysts' recommendations I find Buy and Hold recommendations. The consensus recommendation would be a Hold. The 12 month consensus stock is $2.00 and this implies capital gains of 186%. There are, of course, analysts that think giving a 12 month stock price is nonsense.

A couple of analysts said that they stopped following this company has it cannot make any money. See post by Seeking Alpha. He does not much care for Ballard. However, another blogger on Seeking Alpha quite likes Ballard.

There is an article in Canadian Business about Ballard signing a supply deal with a new African Distributor. There is also a recent article in Canadian Newswire about Ballard fuel cells being reliable during Hurricane Sandy.

I must admit that I have been disappointed in this company because it does not seem capable of making money.

Ballard Power Systems designs and manufactures clean energy hydrogen fuel cells. Better energy, delivered through our focused fuel cell innovations, offers the Power to Change end-user applications, while also improving the environment. Its web site is here Ballard. See my spreadsheet at bld.htm.

This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.

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