Member Info for toneman

Same here TheOldBee. I've held since 3p so made plenty. But the share structure just keeps putting me off. It was not so noticeable a few years ago as the loan size requirements weren't a big problem, but they're just scaling with the company's need for larger cashflow to fulfill the 'relatively' small orders. I've sold regularly on the way up and my shareholding certainly doesn't owe me anything. A fresh look at the numbers again today made me sell another chunk. I'm going to leave the final 8000 shares on the table so I keep an eye on PPS progress. You never know which way these things will pan out.

At least you got a bit of beer and pizza money out of it Seaangler.

I wouldn't go all in on £1.75 either, but I'll certainly congratulate Smithy if he pulls it off.

psmith64, I'm enjoying watching the bet on 175p play out. My view is that any unforced news is likely to be good news, as no-one presents bad news unless they have to (e.g. fires, explosions, cancelled orders, missed earnings). So your best chance for 175p has got to be Final Results possibly early October.

I'd look for particularly weak positive news released before then (insignificant order or grant win, or new director role) as a clue to some imminent lousy numbers.

On the other hand any good news about the factory or significant grant or order will solidify the current SP anyway. As a growth stock ITM only has to be seen to be 'on track' to justify the current SP. The SP of a growth stock after all is really only a measure of shareholder demand, how large the company can grow and how long will it take. It's not really representative of profit/loss and balance sheet at this stage.

I don't remember this being posted here already, so here it is...

https://img.fuelcellsworks.com/wp-content/uploads/2020/08/hydrogen_taskforce_eia_summary.pdf

"Scaling up hydrogen solutions in the UK could unlock £18bn in GVA and 75,000 jobs by 2035"

From today's RNS these are my points of concern...

80% of order intake in 2020 to the date of this report is derived from the stationary segment.
Sales in the first half of 2020 at £1.1m.
2020 order intake to the date is £6.5m.
The 2019 global fuel cells market size was valued at approximately USD 10.48 billion.
The market size will exceed USD 33 billion in 2027.

So interpreting a few things...
Proton Motors share of the market (est 2020 orders USD 15m) is therefore approx 0.15%.
If Proton don't grow market share then their order intake by 2027 would only be approx USD 47m.
Ignoring my last post about shareholders paying loan interest not PPS, then I'm not convinced that even USD47m orders would deliver enough profit to pay for the loan interest, never mind pay off any loan capital.

Based on their market analysis PPS are going to have to grow market share significantly by 2027, but that's against stiff competition from the likes of Ballard, Plug, Powercell and Hydrogenics.

The cost of loans is a really peculiar one. Of the £76m of loans we know that £60m is at 10% interest, so owing £6m each year. But who pays that interest? Well the interest is taken by the lenders in new issue shares which are then free to sell on the open market. So the actual cash value of the interest is paid by anyone who purchases some of those new shares (the issued share value is often at a large discount to current SP). But actually all shareholders pay the interest in dilution of their holding. It's quite clever really, PPS borrows a load of money and then the shareholders pay the interest.

You're welcome slipanchor. Best of luck.

slipanchor, there's an "Everything About Hydrogen" podcast that I can highly recommend. It's been running about a year with episodes approx every two weeks so quite easy to catch up right from the beginning. They've got great interviews from some of my favourite companies - Ballard, ITM, Nel. Plenty of interesting ones from companies I'd never heard of too.

https://podcasts.apple.com/gb/podcast/everything-about-hydrogen-an-inspiratia-podcast/id1475783473

Thanks Way2L8, interesting article.

The article mentions fleetingly about shipping hydrogen across the world in tankers. I think this is one of the biggest advantages hydrogen has over electricity. It's hard to export electricity in bulk. So I think fellows like Dr Joffe need to remember that it's not all about simply generating and using electricity at a single location. If it were, then he'd be correct and it wouldn't make sense to inefficiently generate hydrogen but instead just use the raw electricity itself. But so many areas of the planet are loaded with renewable energy sources (solar, wind and tidal) but you can't use it there, you've got to ship it where it's needed. We already ship oil and gas to where it's needed, so why do these 'experts' seem to forget that when they start discussing hydrogen.

slipanchor, there are a lot of companies looking for a stake in hydrogen. Take a look at this press release listing the companies that signed an open letter to the EU declaring support for the Clean Hydrogen Alliance.

https://hydrogeneurope.eu/sites/default/files/2020.06.02%20Hydrogen%20Europe's%20CEOs%20Letter%20to%20EC_Press%20release.pdf

Ones I have an interest in are: Nel, ITM, McPhy, PHE, PPS, Plug Power, Ballard, PowerCell, Ceres Power, Johnson Matthey, Siemens, Velocys, Fuelcell Energy. I also have a side interest in renewables with Vestas, TRIG, UKW, Siemens Gamesa, Orsted, Broadwind, and GE. Most of them have been good for me, but not all. A lot have a had a good run so you might have to pick your timing well depending on your time horizon. Do your research well. My own opinion is that it's still early days for Hydrogen so my time horizon is still 10 years. In that time I think some of them easily have 5x to 10x growth...I just don't know which ones.

Historically hydrogen has had a few false dawns. I like to ask "If not now. When?"...but one of the most dangerous phrases on the stock market is "This time it's different". Good luck.

Yes, lownat. Those shares are regularly sold to generate cash which is then lent to PPS at 10% interest. The debt building up is quite large. Naturally PPS need to borrow that cash to survive until order volumes take over, but selling chunks of this holding can easily suppress the share price on such a low volume traded share.

For the record, I still own shares in PPS, but they're all on a free ride. It could fly or it could fail, doesn't matter to me either way. So I'm not deramping, just want to make sure you are happy with the share structure before you continue.

lownat, check out the share structure of this company first before you make your investment decision. Make sure you're happy with that.

Bus V2G...now that's probably one of the first ones I would expect to get a "nah, that doesn't work".

I know I've commented before on the never-ending tests and trials being carried out...H2 buses in my particular town/city... electrolyser performance with my particular wind turbine design... producing H2 on site for my particular industrial process. On the plus side I don't know if any have yet concluded "nah, that doesn't work". Surely it's only a matter of time before it becomes the natural choice rather than something new to consider. Hopefully, for all our investments, that 'time' is near.

psmith64, that is an interesting topic, i.e. what moves the price. You say that "The majority of trades here have been small retail customer trades", which I agree with. However the upshot that "they are what have driven the price" I don't entirely agree with.

Looking back over the recent period, the days with significant share price hikes have been where underlying and significant large orders are being filled. They are almost certainly not retail orders (unless incredibly wealthy ones). And in terms of 'driving' the price to the recent 250-350 levels these have been more significant than the small, but many, retail trades. Without the large orders I agree the price does oscillate a lot, which I suppose you could still describe as 'driving' the price, but that is the more limited impact of the retail investors...which is why the day-traders among them eventually give up and move on to another share. The retail investors have to move en masse to move the price significantly, which we can see on specific events like the day the results were announced. Otherwise, retail investors are mostly just 'noise'. You can see the minor effects of this also at the round numbers, which retail investors like, at 150, 200, 250, 300 and 350.

We are still seeing some of these larger trades, too. There was one yesterday with volume about 25% of the entire days buying volume. If these dry up, you could well see your 175p buying price on the horizon. If they don't dry up then you'll have to wait for the order book and your alternative entry point at 400p.

Sorry not directly ITM, but competitor so relevant...

Plug Power just shot the lights out in Q2 results and raised forecasts. Currently up over 18% for the day.

That's going to by smithy's best opportunity for hitting his buy price. Exciting!

Remember that Logan Energy is essentially a systems integrator. I don't see that they have a particular alliance with an electrolyser supplier. It's perhaps too much to believe that they would choose ITM for this, but I guess it's still a possibility.

It is certainly interesting how ITM and others have held up recently. Dropping back from recent peaks certainly seems more than fair. But the fact that it hasn't dropped to 'fair' value or 175p (as some put it) could be telling us something important. That is, the potential upside for this far, far outweighs the downside risk and makes it well worth the punt even at current SP. I think that's why we keep seeing a few large buys steadily trickle through.

Here's an upside view...

We're only 60m revenue away from current SP being fair value anyway. Worst case, that should be no more than a year or two whilst we watch the order book fill up and the factory bed in.
By then we will probably have the second factory announced (possibly in Australia) based on the current factory blueprint. So by 2027 we should have two 1GW factories running at full capacity with another few factories in build in Germany, USA and China.

Now who wouldn't want to pay a little over the odds today for a future like that?

Fortunately nearly everyone knows that Hydrogen is extremely dangerous when mishandled, so the storage and handling controls are already well established. Unfortunately it doesn't yet prevent all accidents or design/manufacture mistakes, so I'd expect an ever-tightening set of controls across the industry.

My worry is over new entrants to the market with the inevitable learning curve and even more inevitable explosions leading to some really bad press. Those days will make a serious dent in our investments.