2025 Hydrogen Stock Investment Guide: Stock Selection Logic Amid the Rise of Green Hydrogen

Under the drive of global carbon neutrality goals, the demand for clean energy has surged. As an important support for a low-carbon economy, hydrogen energy is becoming a hot track that capital is racing to pursue. Throughout 2024, the Morningstar Global Hydrogen Index increased by 4.86%. Although it underperformed the broader market, at the beginning of 2025, related concept stocks experienced significant volatility and rebounds. This shift reflects the market’s reassessment of the long-term prospects of hydrogen stocks.

So, how should investors approach hydrogen energy investments in 2025? What core information do they need to grasp? This article will help clarify the investment logic of this emerging track from three dimensions: individual stocks analysis, industry trends, and investment methods.

Core Investment Targets in Hydrogen Stocks

Latest performance of global hydrogen leaders

Among the most watched hydrogen concept stocks in the current market, US-based Air Products and Chemicals Inc (APD), the world’s largest commercial hydrogen supplier, has gained 53.96% over the past year, performing the best among peers. According to the latest assessment by 15 Wall Street analysts, APD’s 12-month average target price is $362.31, with a high forecast of $385. This company is advancing multiple major projects, with substantial hydrogen infrastructure investments expected in the coming years.

In comparison, Plug Power (PLUG), although down -55.17% over the past year, remains a solid pioneer in the hydrogen fuel cell industry. The company has deployed over 69,000 commercial fuel cell systems, operates more than 250 hydrogen refueling stations in North America, and is building a green hydrogen network covering North America and Europe. The average target price from 21 Wall Street analysts is $2.73, reflecting market recognition of its long-term potential.

International oil and gas giant BP (NYSE: BP) has declined -7.59% over the past year, but its hydrogen strategy is clear and strong—aiming to produce 50-70 thousand tons of low-carbon hydrogen annually by 2030, with a net-zero emission goal by 2050. The average target price from 9 Wall Street analysts is $36.10.

Investment opportunities in Taiwanese hydrogen stocks

In the Asian market, Taiwan’s Chung Hsing Electric (1513.tw) and Gaoli (8996.tw) are two notable hydrogen concept stocks worth watching.

Chung Hsing Electric has actively laid out in the hydrogen industry for years, collaborating with petrochemical giants to build large-scale hydrogen refueling stations, with the first expected to be operational in Q2 2025. The company’s on-hand orders amount to nearly NT$40 billion, with some extending to 2032. In 2024, its consolidated revenue reached NT$25.61 billion, a 15.65% YoY increase, setting a new record. According to FactSet’s survey of 5 analysts, the median target price is NT$220.

Gaoli, as the main OEM for Bloom Energy’s fuel cell dust removal boxes, offers products with flexible installation and short cycle times. The company expects low double-digit growth in plate heat exchangers in 2025, high double-digit growth in fuel cell dust removal boxes, and potential multiple-fold increases in heat dissipation product revenues. The median target price from 5 analysts was lowered from NT$533 to NT$480.

Why Hydrogen Stocks Are Worth Attention in 2025

Policy dividends as investment signals

The US Department of the Treasury recently announced the final rules for clean hydrogen production, clarifying that producers can receive a tax credit of up to $3 per kilogram. This policy clears doubts about subsidy directions, encouraging companies to expand green hydrogen infrastructure investments. Following the announcement, renewable energy stocks like Plug Power rose accordingly.

The International Energy Agency (IEA) released the “Net Zero by 2050” report, indicating that to achieve net-zero goals, global hydrogen demand will reach 530 million tons by 2050. Currently, 17 countries have launched comprehensive hydrogen development strategies, and Taiwan has planned that hydrogen will account for 9%-12% of its supply in the net-zero pathway by 2050.

Expectations of explosive market growth

The global green hydrogen market was valued at only $1.1 billion in 2023 but is expected to grow at a CAGR of 61.1%, reaching $30.6 billion by 2030. This means the market size will expand nearly 28 times in 7 years.

In 2023, a total of 1,418 hydrogen projects were announced worldwide, with a total investment of $570 billion, a 31% increase from the previous year. The fastest-growing segments are fuel cell electric vehicles and the power industry, driven by the popularity of hydrogen fuel cell vehicles, advances in electrolysis technology, and decreasing renewable energy costs.

Risks to Watch When Investing in Hydrogen Stocks

Increased industry competition leading to volatility

As more companies enter the hydrogen field vying for market share, price wars are intensifying. Companies like Plug Power face profit erosion amid cost competition, leading to greater stock price fluctuations. Investors should focus on these companies’ technological innovation capabilities and cost management.

Uncertainty in hydrogen production costs

While technological progress has lowered green hydrogen production costs, some capacities still rely on fossil fuels. This keeps hydrogen prices closely linked to international oil prices—rising oil prices will increase hydrogen production costs, potentially weakening market competitiveness.

Three Ways to Invest in Hydrogen Energy Compared

Contract for Difference (CFD): high leverage, high risk

Investing in hydrogen stocks via CFDs does not require direct ownership; instead, profits are made by predicting price movements. This method offers high leverage and flexibility, suitable for short-term traders. The minimum deposit can be as low as $50, and accounts can be funded in TWD.

Traditional stock investment: stable, capital-intensive

Buying and holding hydrogen concept stocks directly, profiting from stock price appreciation. This approach has relatively controlled risk but requires more capital.

Funds and ETFs: diversified, professionally managed

Investing in hydrogen-themed funds or ETFs (such as Global X-Hydrogen ETF, Direxion-Hydrogen ETF) allows indirect holding of multiple stocks, achieving risk diversification. Compared to single-stock investments, funds tend to be more resilient but offer lower returns.

Understanding the Hydrogen Industry Chain and Focusing on Investment Priorities

Upstream: core value of green hydrogen production

Currently, there are three types of hydrogen: gray hydrogen (from fossil fuels, highest carbon emissions), blue hydrogen (fossil fuels + carbon capture), and green hydrogen (produced via renewable energy electrolysis, zero emissions). In the future, green hydrogen’s share will increase significantly, making upstream green hydrogen production companies the main investment opportunities.

Midstream: bottlenecks in storage and transportation infrastructure

Large-scale storage options include salt caverns or rock caverns combined with pipeline transportation, but geographic limitations hinder widespread adoption. High-pressure hydrogen transportation is the mainstream, with the number and distribution of refueling stations directly affecting logistics costs and efficiency.

Downstream: the most promising in transportation

Hydrogen’s downstream applications cover transportation, industrial manufacturing, power generation, and energy storage. Among these, transportation—especially fuel cell vehicles—is considered the most promising growth area.

From the industry chain perspective, investment should focus on upstream green hydrogen production and downstream transportation, as these segments have stronger growth logic and potential compared to others.

Summary: How to Capture Hydrogen Stock Opportunities in 2025

Hydrogen energy has moved from concept verification to commercialization. Driven by policy support, technological progress, and market demand, the investment window for hydrogen stocks is opening.

Key investment tips:

• Focus on opportunities after green hydrogen infrastructure is improved—prefer high-quality companies involved in green hydrogen manufacturing, storage, sales, and end-use applications
• Combine global and regional strategies—allocate both international leaders like APD, Plug Power, and regional leaders like Chung Hsing Electric, Gaoli
• Choose investment methods based on risk appetite—conservative investors can opt for stocks and funds; aggressive investors may explore CFD trading
• Be vigilant about industry competition and cost pressures—regularly evaluate the technological competitiveness and profitability of holdings

The hydrogen energy track in 2025 is full of opportunities but also hidden challenges. Mastering industry logic, selecting quality targets, and controlling risk exposure are essential to achieving desirable returns in this energy transition wave.