Exploring Two Hydrogen Energy Stocks: A Comparative Look at $200 Investment Potential

Hydrogen energy represents one of the most promising clean fuel alternatives available today, with the capacity to be produced through renewable sources like wind and solar power. When water molecules are split using renewable electricity, the extracted hydrogen can power engines with water as the sole emission—making it an exceptionally clean energy solution.

However, widespread adoption has faced significant obstacles. The production costs for hydrogen fuel remain considerably higher than conventional oil and natural gas extraction, and existing electrical infrastructure expansion proved more economical than building new hydrogen distribution networks. Rising inflation and interest rate hikes further dampened investor enthusiasm for hydrogen projects.

Yet the landscape is shifting. As hydrogen technology matures and the macroeconomic climate stabilizes, the long-term cost advantages could justify initial infrastructure investments. Fortune Business Insights projects the hydrogen fuel cell market will expand at a 30% compound annual growth rate (CAGR) through 2032, while Research Nester anticipates the hydrogen vehicle sector will grow at 45% CAGR from 2025-2037.

Two overlooked companies positioned at the forefront of these trends—Plug Power (NASDAQ: PLUG) and Nikola (NASDAQ: NKLA)—merit consideration for growth-oriented investors. Both demonstrate significant volatility but carry substantial upside potential for patient capital.

Plug Power: The Hydrogen Infrastructure Play

Plug Power operates as a leader in hydrogen fuel cell systems and refueling infrastructure, primarily serving the warehouse and logistics sector. The company has installed more than 69,000 fuel cell units and 250 hydrogen refueling stations globally, positioning itself as the world’s largest buyer of liquid hydrogen. Its customer base includes several major logistics providers and e-commerce companies.

Revenue momentum has been impressive: 40% growth in 2022 and 27% in 2023, driven substantially by strategic acquisitions that strengthened its cryogenic equipment division. While its core hydrogen fuel cell business faced headwinds from macro uncertainty, the company successfully integrated these acquisitions despite widening net losses during the transition period.

Looking ahead, analysts project 25% revenue CAGR from 2023 through 2026, with narrowing losses. The U.S. Department of Energy recently awarded Plug Power a $1.66 billion loan to construct up to six green hydrogen production facilities—a major validation of its technology and market potential.

At an enterprise value of $2.67 billion and trading at 2.3 times forward sales, the stock appears undervalued relative to projected growth rates. Insider buying activity signals confidence, with company executives purchasing nearly five times more shares than they sold over the past year. International investors have also taken notice—a major Norwegian sovereign wealth fund recently raised its stake to approximately 8%.

Nikola: The Hydrogen Vehicles Pioneer

Nikola manufactures electric semi-trucks and represents the hydrogen vehicle market opportunity. The company initially focused on battery-electric vehicles (BEVs) but has now begun delivering hydrogen fuel-cell electric trucks (FCEVs), marking a strategic pivot.

The company’s journey has been challenging: it missed original delivery targets following its 2020 public debut, faced leadership transitions, and experienced battery-related recalls that suspended BEV sales. Additionally, Nikola operates in a highly competitive segment and faces profitability pressures while managing a significantly expanded share count from capital raises.

Yet momentum indicators are encouraging. The company delivered 203 FCEVs during the first nine months of 2024 and projects 300-350 FCEV deliveries for the full year. Analysts forecast revenue will more than triple to $112 million in 2024, followed by nearly tripling again to $328 million in 2025 as FCEV production scales and BEV operations restart.

Nikola is also developing hydrogen fueling infrastructure, planning a network of 60 charging stations across the United States alongside infrastructure partners by 2026—addressing a critical barrier to fuel-cell vehicle adoption.

With an enterprise value of $338 million and trading at roughly 1 time forward sales, Nikola represents an extremely inexpensive valuation. Insider purchasing has been particularly aggressive, with executives buying 15 times more shares than they sold over the past 12 months—suggesting management confidence in the company’s hydrogen vehicle strategy.

Investment Considerations

Both companies offer compelling narratives tied to hydrogen energy’s long-term tailwinds. A modest $200 investment positioned across either company could potentially generate substantial returns as market adoption accelerates and costs normalize. However, these remain speculative opportunities characterized by execution risk, competitive pressures, and continued market development uncertainties. Investors should carefully evaluate their risk tolerance before committing capital to these hydrogen energy plays.