Bernstein Maintains Outperform on Air Products (APD) Following Hydrogen Megaproject Announcements

Core Viewpoint - Air Products and Chemicals, Inc. (NYSE:APD) is considered one of the top hydrogen and fuel cell stocks to invest in for 2026, despite a recent 11% stock drop attributed to market overreaction following the announcement of negotiations with Yara for hydrogen megaprojects [1]. Group 1: Company Developments - The agreement between Air Products and Yara focuses on the Louisiana Clean Energy Complex and Saudi Arabia's NEOM Green Hydrogen Project, aiming to cover approximately 25% of the costs for the Darrow project [2]. - Yara is looking to acquire ammonia production, storage, and shipping facilities, with an estimated investment of $2-2.25 billion [2]. - Analyst James Hooper from Bernstein noted that the recent release from Air Products is "broadly positive" regarding long-term demand for both blue and green hydrogen, addressing previous concerns about hydrogen demand [2]. Group 2: Market Reaction and Analyst Insights - Bernstein maintains an Outperform rating on Air Products with a price target of $320, suggesting that the market's negative reaction was an overreaction [1]. - Hooper emphasized that the frameworks established by the projects are "supportive" despite lower cash generation and ongoing uncertainties related to the projects [3]. - Air Products is recognized as a leading US-based industrial gases company, involved in developing and operating some of the largest clean hydrogen projects globally [3].