Plug Power Stock: Buy, Sell, or Hold?

Plug Power (NASDAQ: PLUG), a developer of hydrogen charging technologies, has shed astir 99% of its worth since its archetypal nationalist offering (IPO) successful 1999. It initially planned to plan and physique hydrogen-powered residential systems, but that program fizzled retired and it pivoted toward selling hydrogen substance cells and charging systems for warehouse forklifts.

That caller concern attracted the attraction of Amazon (NASDAQ: AMZN) and Walmart (NYSE: WMT), and the 2 retail giants became Plug Power's 2 biggest customers. But it inactive struggled with sluggish income maturation and steep losses implicit the past fewer years, and a dimming outlook for the niche hydrogen marketplace drove its banal to all-time lows.

Is determination immoderate anticipation near for Plug Power astatine these levels? Let's reappraisal the main reasons to buy, sell, and clasp this divisive stock.

The bears volition archer you that, 26 years aft its IPO, Plug Power inactive hasn't proven that its concern exemplary is sustainable. Instead, it lone gained Amazon and Walmart arsenic its apical customers by subsidizing their hydrogen substance cells with its ain stock warrants -- oregon options to bargain much of its shares astatine a discount.

That antithetic strategy backfired erstwhile those incentives eclipsed its lawsuit payments from 2018 to 2020. Plug Power besides didn't initially decently cipher those incentives and warrants, truthful it had to spell backmost and restate each of its financials for each 3 years. After those jarring restatements, its reported gross really turned negative successful 2020.

Its gross turned affirmative again successful 2021 and grew successful 2022 and 2023, but astir of that maturation was driven by 2 acquisitions that expanded its smaller cryogenic instrumentality unit. Meanwhile, its halfway hydrogen substance compartment and charging systems concern struggled arsenic macro headwinds curbed the market's request for caller hydrogen charging projects.

In the archetypal 9 months of 2024, Plug's gross plunged arsenic it afloat lapped those acquisitions and struggled to merchantability much hydrogen substance systems and charging services. Its operating borderline besides plummeted arsenic it racked up alarming losses.

Data source: Plug Power. YOY = Year implicit year. *Due to restatements.

For the afloat year, analysts expect Plug's gross to diminution 21% to $705 cardinal with a nett nonaccomplishment of $738 million. That seems similar a grim concern for a institution that ended the 3rd 4th with conscionable $94 cardinal successful currency and equivalents.