Pavel Molchanov, Managing Director, Renewable Energy and Clean Technology, Raymond James & Associates
Pavel Molchanov is Managing Director, Renewable Energy and Clean Technology, for Raymond James & Associates, Inc. (NYSE: RJF, Raymond James Financial)
He joined the firm in 2003 and has been part of the energy research team ever since.
He became an analyst in 2006, the year he initiated coverage on the renewable energy/clean technology sector. In this role, he covers all aspects of sustainability-themed technologies, including solar, wind, biofuels, electric vehicles, hydrogen, power storage, grid modernization, water technology, and more.
Within the energy research team, he also writes about the broader topics of geopolitical and regulatory issues, climate change, and ESG investing.
He has been recognized in the StarMine Top Analyst survey, the Forbes Blue Chip Analyst survey, and The Wall Street Journal Best on the Street survey.
He graduated cum laude from Duke University in 2003 with a bachelor of science degree in economics, with high distinction. In the broader community, he is a member of the Board of Visitors at the University of North Carolina’s Institute for the Environment; a member of the Advisory Board at Cool Effect, an environmental project funding charity; and the founder of the Molchanov Sustainability Internship Program at the Royal Institute of International Affairs in London.
In this 2,033 word interview, exclusively in the Wall Street Transcript, Pavel Molchanov details his top picks including Bloom Energy (NYSE: BE) and the reasoning behind his belief in their value to investors.
“Bloom Energy (NYSE: BE, Bloom Energy Corp) a play on hydrogen, is one that I like a lot.
This company faced margin pressure from higher input costs over the past year. And the stock had been very expensive at the beginning of 2021.
Bloom is the world’s largest provider of stationary fuel cells. This means fuel cells that provide distributed electric power for businesses, such as data centers, hospitals, and office buildings.
Also in 2022, Bloom will be launching an electrolyzer product.
An electrolyzer is quite literally the inverse of a fuel cell. A fuel cell generates electricity, whereas an electrolyzer uses electricity to produce hydrogen, specifically what’s called green hydrogen.
Green hydrogen is a nascent but exciting market, particularly in Europe, where the European Union has ambitious targets for scaling up green hydrogen production.”
The Bloom Energy (NYSE: BE) recommendation is not without its constraints.
“The supply chain problems that reduced the profitability of many cleantech companies in the past 12 months are not going to go away overnight. It will be a gradual process, and investors should be aware of the continuation of COVID-related supply chain risk.
Secondly, we need to watch what happens with public policy. Policy as it relates to climate and sustainability varies a great deal from country to country. For example, in Washington, as 2021 comes to an end, it looks like the Build Back Better reconciliation package is unlikely to pass anytime soon.
This has relevance for cleantech from the perspective of tax credits. In the European Union, we will be watching the implementation of the European Climate Law, which in general, offers much better visibility than climate policy in Washington.”
The politics of hydrogen power are an important driver in the valuation of Bloom Energy (NYSE: BE) as well as all renewable energy stocks.
“China is a crucial variable because it’s the world’s largest CO2 emitter.
Close to 30% of the world’s CO2 emissions come from China, more than the United States and European Union combined.
In July of 2021, China began its national carbon trading program, which is an important step in the direction of decarbonization. China is also the world’s largest solar market, the largest wind market, and the largest electric vehicle market. But on the other hand, the Chinese government continues to remain supportive of coal, despite its very problematic climate impact.
India is somewhat of a mixed bag in its climate policy as well.
There are two other important economies where elections need to be watched in the next 12 months.
In Australia, which is a G20 economy and a large CO2 emitter, the election will be held no later than May of 2022.
If the Labor Party comes to power, that would have a positive effect on Australian climate policy.
The other election coming up is in Brazil, also a G20 economy. The Brazilian election will be in October. If President Bolsonaro loses and is replaced by a more climate-friendly administration, that would be a positive step to making Brazil a player in climate action, especially in preventing deforestation.”
Get all of the top picks from Pavel Molchanov, award winning research analyst from Raymond James Financial, in this 2,033 word interview, exclusively in the Wall Street Transcript.
Pavel Molchanov, Managing Director, Renewable Energy and Clean Technology
Raymond James & Associates, Inc.
email: pavel.molchanov@raymondjames.com
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