The Hazer share price gained 40% last year but its tumbling in 2022. What’s going wrong?

Could this be weighing on the ASX hydrogen stock?

| More on:
a woman wearing green and sitting in a green room with a green coffee cup puts her hand to her forehead in dismay while looking at papers sitting at her computer.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • After posting a strong performance in 2021, the Hazer share price has tumbled into the new year, sliding nearly 21% this year so far 
  • There's been some notable news to help explain much of the stock's slump 
  • However, it could also be struggling due to institutions' hesitation to pump funds into Australia's hydrogen sector 

The new year is proving to be a tough slog for the Hazer Group Ltd (ASX: HZR) share price.

The technology company that’s creating low-emissions hydrogen and graphite production processes saw its stock surge 41.98% in 2021. It ended last year trading at $1.15.

Sadly, 2022 hasn’t been so kind to Hazer’s shares. They’ve tumbled 20.96% year to date.

At the time of writing, the Hazer share price is trading at 90.5 cents.  

So, what’s been dragging on the hydrogen-focused ASX share this year? Let’s take a look.

What’s going wrong for the Hazer share price?

The Hazer share price has been struggling amid a barrage of news and reports that large investors are hesitant to invest in hydrogen.

Defects in parts for the company’s commercial demonstration project and sliding revenues have weighed on the stock in 2022. Meanwhile, it was boosted by the announcement of a new Canadian hydrogen production facility.

However, some of the market’s big players are wary of hydrogen despite its apparent popularity.

Australian National University energy economist, Paul Burke, believes that Australia’s potential to become a major green energy exporter is vast, reports the Financial Times (FT). But more funds are needed to realise the sector’s potential.

Additionally, Burkes notes that the federal government “could be doing more” to support the nation’s green energy potential.

The government has invested in hydrogen projects – including ‘blue’ hydrogen projects, which create carbon emissions.

In fact, the federal government promised hundreds of millions for hydrogen production in its latest budget.

But that probably won’t be enough.

Hydrogen is one of the newest forms of low-emissions energy and it’s reportedly lacking capital from super funds and investment houses.

While initiatives like an emissions trading scheme or a carbon tax could do more to force investment in low-emissions energy sources, Burke told the FT, a lack of capital could be dragging on sentiment for Australia’s hydrogen sector.

And that could be weighing on the Hazer share price in 2022. Though, the company’s stock isn’t alone in the red.

The share prices of hydrogen-focused companies, Pure Hydrogen Corporation (ASX: PH2), Province Resources Ltd (ASX: PRL), and Sparc Technologies Ltd (ASX: SPN) have respectively slumped 23%, 35% and 51% year to date.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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.

More on Energy Shares

A man in a hard hat puts his finger up to say 'number one' in front of an oil mine
Energy Shares

‘Need to see cash’: Why these fundies tip big things for the Santos share price

The oil and gas trade continues to wind up.

Read more »

Workers inspecting a gas pipeline.
Energy Shares

What’s going on with the Woodside Energy share price today?

Woodside shares continue to recede this week.

Read more »

sad looking petroleum worker standing next to oil drill
Energy Shares

What’s going on with the Beach Energy share price on Thursday?

Beach shares are under pressure on Thursday...

Read more »

Worker inspecting oil and gas pipeline.
Energy Shares

What’s with the AGL share price today?

The company's chair has outlined the company's next steps forward.

Read more »

A woman wearing a hard hat holds two sparking wires together as energy surges between them. representing the rising Li-S Energy share price today
Energy Shares

ASX utilities shares electrifying the market as suspension begins to unwind

Why are ASX utilities shares like AGL beating the market today?

Read more »

a man sits in unhappy contemplation staring at his computer on his desk in a home environment, propping his chin on his hand.
Energy Shares

How attractive is the Santos dividend right now?

We check the oil and gas giant's dividend after such a strong year.

Read more »

a coal miner in hard hat with a light on it kisses a large lump of coal that he is holding in his hand.
Energy Shares

This ASX coal share is flying higher today after CEO speaks his mind

Coal producers in Queensland are looking at paying the highest royalties in the world.

Read more »

Workers inspecting a gas pipeline.
Energy Shares

Woodside share price lifts despite $17b ‘climate bomb’ court action

An environmental group will ask the Federal Court to stop work at the Scarborough gas project.

Read more »