Is it a good company at a reasonable price? The stock price would seem to be currently expensive. Because the stock price is expected to fall, it would seem that analysts think it is currently too high also. The company has no earnings and cash flow, but does have revenue.
I do not own this stock of Ballard Power Systems Inc (TSX-BLDP, NASDAQ-BLDP). Back in 1997, I read about Ballard and fell in love with the idea of cars running with fuel cells. I could help save the environment and make some money. It was very attractive. I sold this stock in 2006 because it had lost its attraction. It did not seem that Ballard fuel cells would be in any car anytime soon. I was ahead in 2000, but the stock started to fall in October 2000 and never recovered.
When I was updating my spreadsheet, I noticed that last year, analysts expected Revenue at 119M and it came in at 104M. For 2021, they expected Revenue at $154M and it came in at $105M. For a while there in late 2020 and early 2021, this stock was above the $17.35 I paid for this stock in 1997. I sold at a loss in 2006 because I felt it was never going anywhere anytime soon.
If you had invested in this company in December 2011, $1001.00 you would have bought 910 shares at $1.10 per share. In December 2021, after 10 years you would have received $0 in dividends. The stock would be worth $14,459.90. Your total return would have been $14,459.90. However, the stock has fallen this year and at present, these shares would be worth $8,226.40.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $1.10 | $1,001.00 | 910 | 10 | $0.00 | $14,459.90 | $14,459.90 |
There are no dividends on this stock. The stock never paid dividends.
Debt Ratios are good. The Long Term Debt/Market Ratio is 0.00. There is not much of any long term debt. The Liquidity Ratio for 2022 is 14.78. The Debt Ratio is 12.78. The Leverage and Debt/Equity Ratio are 1.08 and 0.08.
The Total Return per year is shown below for years of 5 to 26 to the end of 2021 in CDN$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2016 | 5 | 0.00% | 48.24% | 48.24% | 0.00% |
| 2011 | 10 | 0.00% | 30.61% | 30.61% | 0.00% |
| 2006 | 15 | 0.00% | 5.97% | 5.97% | 0.00% |
| 2001 | 20 | 0.00% | -5.34% | -5.34% | 0.00% |
| 1996 | 25 | 0.00% | 2.78% | 2.78% | 0.00% |
| 1995 | 26 | 0.00% | 4.55% | 4.55% | 0.00% |
The Total Return per year is shown below for years of 5 to 26 to the end of 2021 in US$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2016 | 5 | 0.00% | 50.07% | 50.07% | 0.00% |
| 2011 | 10 | 0.00% | 27.81% | 27.81% | 0.00% |
| 2006 | 15 | 0.00% | 5.42% | 5.42% | 0.00% |
| 2001 | 20 | 0.00% | -4.16% | -4.16% | 0.00% |
| 1996 | 25 | 0.00% | 3.09% | 3.09% | 0.00% |
| 1995 | 26 | 0.00% | 4.87% | 4.87% | 0.00% |
The 5 year low, median, and high median Price/Earnings per Share Ratios are all negative and therefore useless. The corresponding 10 year ratios are also negative and useless. The corresponding historical ratios are also negative and useless. The company does not have any earnings and is not likely to have any earnings anytime soon. This is not a viable test.
Without any earnings, a Graham Price test is also not a viable test.
I get a 10 year median Price/Book Value per Share Ratio of 3.71. The current P/B Ratio is 1.84 based on a stock price of $7.97, Book Value of $1,286M and Book Value per Share of $4.32. The current ratio is 50% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$ and you will get similar results in CDN$.
Cash Flow is negative, so I can do not viable test here. There are no dividends, so no dividend tests can be done.
The 10 year median Price/Sales (Revenue) Ratio is 5.04. The current P/S Ratio is 21.36 based on Revenue estimate for 2022 of $111M, Revenue per Share of $0.37 and a stock price of $7.97. The current ratio is 324% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$ and you will get similar results in CDN$.
Results of stock price testing is that the stock price is probably currently expensive. I base this on the P/S Ratio test. I note that the P/B Ratio tests says that the stock is cheap. However, this company has no earnings and no earnings in the foreseeable future.
When I look at analysts’ recommendations, I find Strong Buy (3), Buy (5), Hold (13), Underperform (1) and Sell (1). The consensus would be a Hold. The 12 month stock price consensus is $9.59 ($7.47 US$). This implies a capital loss of 6.19% based on a current stock price of $10.22.
There are analysts’ comments on Stock Chase but not much in recommendations to buy. Stock Chase gives this stock 3 stars out of 5. Amy Legate-Wolfe on Motley Fool thinks this might be a good alternative energy option. Sneha Nahata on Motley Fool thinks this stock could outperform the TSX in the long term. The company in a Press Release talks about their fourth quarter result. The company in a Press Release talks about their first quarter of 2022 result.
Simply Wall Street report on Yahoo Finance talks about this company cash burn. Simply Wall Street has one warning for this company of currently unprofitable and not forecast to become profitable over the next 3 years
Ballard is a world leader in proton exchange membrane fuel cell, power system development, and commercialization. The company's principal business is the design, development, manufacture, sale and service of PEM fuel cell products for a variety of applications, focusing on power product markets of heavy-duty motive (consisting of bus, truck, rail, and marine applications), material handling, and stationary power generation. Sales are concentrated in the U.S., Europe, and China. Its web site is here Ballard Power Systems Inc.
The last stock I wrote about was about was Savaria Corporation (TSX-SIS, OTC-SISXF) ... learn more. The next stock I will write about will be Loblaw Companies Ltd (TSX-L, OTC-LBLCF) ... learn more on Tuesday, August 2, 2022 around 5 pm.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
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