Plug Power, Inc.

PLUG Details

Plug Power, Inc. (NASDAQ: PLUG) provides comprehensive hydrogen fuel cell turnkey solutions. It created the first commercially feasible market for hydrogen fuel cell technology. The company has a market capitalization of ~US$13.30 billion as on 6^th May 2021.

Result Update – For the Year Ended 31 December 2020

On 25 February 2021, the Company announced its financial results for Q4FY20 and FY20 and as per the release dated 16 March 2021, the company is determined to restate certain prior period financials statements to be included in the 2020 Form 10-K. Therefore, it must be noted that the reported figures for Q4FY20 and FY20 may get revised.

However, as per the release dated 25 February 2021, the revenue was negatively impacted by certain costs of $456 million reported in Q4FY20, primarily relating to non-cash charges pertaining to the accelerated vesting of a customer’s remaining warrants. This impacted the revenue of negative $316 million for Q4FY20 and negative $100 million for FY20.

Key Data (Source: Company Reports)

Recent Updates

Shareholder Alert Filing Deadline: On 6 May 2021, Pomerantz LLP released a report that a class action lawsuit has been filed against PLUG and certain of its officers in the United States District Court at the Central District of California and docketed under 21-cv-02402. The lawsuit is on behalf of a class consisting of all persons and entities other than Defendants that purchased/acquired PLUG stocks between 9 November 2020 and 1 March 2021, inclusive.

As per the complaint throughout the Class Period, Defendants made materially false and/or misleading statements. At the same time, the company failed to disclose material adverse facts about the Company’s business, operations, and prospects.  Specifically, Defendants failed to disclose to investors: (1) that the Company will not beable to file its 2020 annual report timely due to delays related to the review of classification of certain costs and the recoverability of the right to use assets with certain leases; (2)  the Company was practically likely to report material weaknesses in its internal control over financial reporting; and (3) that, due to foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

Plug Final Deadline: Rosen law firm encourages PLUG investors with losses over $100K to secure counsel before Friday (7 May 2021) deadline in securities class action.

Partnered with BAE Systems for Hydrogen-Powered Electric Buses: As per the release dated 29 April 2021, the company reported a strategic collaboration with BAE Systems to supply zero-emissions powertrains to heavy-duty transport bus OEMs in North America. This will be achieved by assimilating PLUG’s ProGen fuel cell engines into BAE Systems’ smart electric drive systems, and supply hydrogen and refueling platform to end-customers use points.

Risks

The company is aggressively signing JVs and partnership to grow further, which may impact the overall profitability at a strong pace of growth For production, PLUG is relying on the accessibility and supply of hydrogen gas and third party sourcing of key components, favourable commodity prices, and smooth supply chain, among others, which may have the risk of favourable terms and conditions.

Outlook:

Fundamentally the company has exceeded its gross billing target of $330 million in 2020 and expects the momentum to continue going forward. Gross billings are expected to grow to $475 million in 2021, up from $450 million stated earlier. This will be driven by phenomenal CapEx and OpEx investments to augment and accelerate the growth across all green hydrogen and fuel cell platforms.

Moreover, the company has set four major goals for 2021: (1) Accelerate expansion in green hydrogen generation business (2) Successfully launch JVs with Renault and SK Group enabling a global footprint (3) Continue to expand via partnerships, joint ventures and acquisitions in the hydrogen ecosystem (4) Expand customer relationships across all businesses to achieve $750 million in gross billings in 2022

Technical Overview:

Weekly Chart

Source: Refinitiv (Thomson Reuters)

Note: The Yellow color line in the chart shows RSI (14-period). Orange color upward sloping line represent trendline whereas the blue color histograms represents volume of the stock. Green and purple color lines represents 21 and 50 period Simple Moving Averages, respectively.

PLUG prices have shown significant fall in past 4 months by ~71% from its 52-week high levels made in January 2021. Prices are now getting strong support of the upward sloping trendline near to $22 level. Volumes are showing decreasing trend along with falling prices that indicates the existing falling trend could reverse anytime soon. RSI (14) is hovering near to oversold region ~ 39 on weekly chart suggesting the current price momentum is weak. Immediate support levels are $22 and $13.69 while immediate resistance levels are $30.46 and $39.75.

Stock Update:

The stock has witnessed a fall of ~66.7% in 3 months while over the last 6 months, it has increased by ~19.8%. Further, the stock reported a growth of ~110.2% in 9 months and ~441.0% in 1 year. The stock has a 52-week low and high of $3.80 and $75.49, respectively and is currently trading below the average of 52-week high-low range. The stock is trading at the current market price of US$22.59 per share, down ~7.12% on 6^th May 2021. We are also keeping a close watch on the developments of the business and the emergence of any catalyst may lead to change in our previous recommendation.

Note: Investment decision should be made depending on the investors’ appetite on upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the Valuation has been achieved and subject to the factors discussed above.

Disclaimer

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