Hazer shares closed at $1.07 yesterday and opened at $1.13 today before climbing as high as $1.27 soon after. These levels are a new all-time high for the company. It also puts Hazer up more than 80% in the past month, and more than 200% over the past 12 months.
So what is the Hazer Group? And why is the Hazer share price rocketing today?
Lazer, blazer, Hazer?
Hazer Group is a company that, in its own words, is “pioneering a low-cost, low-emission hydrogen and graphite production process [the Hazer process]”. Hazer says this process enables the effective conversion of natural gas and similar feedstocks into hydrogen and high quality graphite, using iron ore as a process catalyst.
Using this technology, the company aims to “play a significant role across three multi-billion dollar global markets” by producing hydrogen at a lower cost than alternative methods.
It does so by taking methane (a potent greenhouse gas) and breaking it down using the ‘Hazer process’ into its elements of hydrogen and carbon (in graphite form). It then is able to sell the hydrogen as a fuel and the graphite as a low-cost industrial input.
Hazer notes that hydrogen has a global market worth around US$100 billion. Hydrogen is used in many commercial applications such as ammonia production and in the petroleum industry. It is also touted as a potential fuel for zero-emission vehicles and electricity generation.
Meanwhile, graphite has many industrial applications as well. This includes (as Hazer points out) lithium-ion batteries that are found in electric vehicles. The company also notes that traditional graphite extraction is highly damaging to the environment as it usually involves large open-cut mines. It also necessitates the use of harsh petroleum products in the refining process. Hazer’s graphite requires none of these for production.
Why is this company’s share price surging today?
Normally a share price move like we’ve seen with Hazer today is spearheaded by a company announcement or some other big news. But strangely, there appears to be no obvious catalyst for the moves we are seeing today.
The company’s last announcement to the markets was back on 12 January. And that was just some fairly unnotable information regarding the company’s recent annual general meeting. We did also see a notice that one of Hazer’s directors, Tim Goldsmith, had picked up a hefty parcel of shares. But that was back on 4 January.
As such, we can probably put today’s moves down to good old-fashioned buying pressure. ASX data shows that trading volume today hit 1.8 million shares, well above the company’s 5-day average of just under 1.5 million.
In fact, the volume has either been at, or exceeding, this average over the past 5 days. We could just be witnessing a classic momentum story here.
Electric car companies like Tesla Inc (NASDAQ: TSLA) are all the rage right now. Could it be guilt by association? Maybe it’s because sometimes when investors see that a company is up 55.7% year to date (and it only 19 January), they just assume it will keep going up. Or maybe someone knows something we all don’t yet.
Sometimes the markets give us a curveball when things aren’t as obvious as we’d like. But that’s investing for you!
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Sebastian Bowen owns shares of Tesla. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Tesla. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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