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The Zacks Analyst Blog Highlights: FuelCell Energy, Ballard Power Systems, Plug Power, Wal-Mart Stores and Toyota Motor

CHICAGO, March 13, 2014 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the FuelCell Energy (Nasdaq:FCEL-Free Report), Ballard Power Systems Inc. (Nasdaq:BLDP-Free Report), Plug Power Inc. (Nasdaq:PLUG-Free Report), Wal-Mart Stores Inc. (NYSE:WMT-Free Report) and Toyota Motor Corp. (NYSE:TM-Free Report).

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Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Wednesday's Analyst Blog:

Fuel Cell Stocks Crash After Great Run

The price of fuel cell stocks finally showed signs of correction after an incredible run since the beginning of 2014. Leading players in the plug power space like FuelCell Energy (Nasdaq:FCEL-Free Report), Ballard Power Systems Inc. (Nasdaq:BLDP-Free Report) and Plug Power Inc. (Nasdaq:PLUG-Free Report) have shed 16.54%, 25.87% and 41.51%, respectively, yesterday.

Drop After a Dream Run

Fuel cell stocks were on a bull run since the beginning of the year, fired by strong fundamentals and the new-found prospects of fuel cell technology in the green energy space. In addition, a big order clinched by Plug Power from retail giant Wal-Mart Stores Inc. (NYSE:WMT-Free Report) added further stimulus to its share price.

However, a correction in prices were on the cards as the top three stocks, namely, FuelCell Energy, Ballard Power and Plug Power had gained nearly 178.7%, 325.6% and 565.2% respectively till Mar 11 from the beginning of the year.

Fizz Over for Fuel Cell Stocks?

Has the bubble really burst for fuel cell stocks? As we are well aware, stringent emission policies in the U.S. will drive more and more investments in the alternate energy space.  

The sudden drop in prices does not necessarily mean that fuel cell stocks have run its course like a meteor burning up. We believe it is only a temporary pullback, and a profit booking phase for investors. Trading volumes of these three stocks on Mar 12 remained pretty high indicating that investors were looking to book gains.

Future of Fuel Cell Stocks

The question now is whether these stocks will regain lost ground. Historically, we have seen that the adoption of new technology comes with some growing pains. The support of the U.S. Department of Energy (DoE) and interest of the industry majors in this space will be the driving force for these stocks going forward.

Ballard Power has a Zacks Rank #2 (Buy) while FuelCell and Plug Power hold a Zacks Rank #3 (Hold). The Zacks Consensus Estimate of these three stocks has shown an upward trend of late.

Toyota Down After Highlander Recall

Product recalls are the precautionary steps taken to avoid accidents due to any glitch in a vehicle. However, the recalls dent the company's image and the 0.8% fall in Toyota Motor Corp.'s (NYSE:TM-Free Report) shares on Mar 11 highlights that. The decline was due to the news that Toyota has recalled 7,067 of its new Highlander crossover SUVs. The recall is being made to fix a problem in the seat belts.

The recalled Highlander crossovers are from model year 2014. According to The National Highway Traffic Safety Administration, the middle seat belt of the third row is not properly secured to the vehicle's floor. In case of a crash, a faulty seat belt will increase the probability of injury. However, no cases of casualties have been reported.

Toyota will be recalling the vehicles later this month. The Toyota dealers will service the recalled Highlanders at no extra charge. Toyota had commercialized the third-generation Highlander this year.

The new 2014 Highlander comes with a new look, a sophisticated cabin and better safety and technology. It offers a choice between a four-cylinder, a V-6 and a hybrid engine.

Toyota witnessed several recalls in Feb 2014. On Feb 12, the automaker announced the global recall of 1.9 million third-generation Prius cars to repair a software problem in the hybrid system. Following this, on Feb 14, Toyota recalled 295,000 vehicles of the Lexus and Toyota brands globally due safety system problems involving stability control and anti-lock brakes. 261,114 of the total recalled vehicles of model years 2012 and 2013 were in the U.S.

Moreover, on Feb 17, Toyota announced its intent to recall 13,000 FJ Cruiser sport-utility vehicles in the Middle East, Australia, Africa and Panama. The recall will be made to rectify fuel tubes prone to overheating, which may cause them to melt, leading to gas leaks. This defect has led to five fire reports, although there is no report of casualty. The recalled FJ Cruisers were manufactured in the Oct 2012–Jan 2014 period.

Currently, Toyota carries a Zacks Rank #2 (Buy).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

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