Plug Power rally continues to +102% up in just one week

Summary

  • Plug Power (PLUG) is up 102% since last week due to South Korean $1.5 billion investment to expand the Asian market.
  • Following that news, Plug Power has announced yesterday a new deal with Renault to build a joint venture in France in order to achieve a 30% market share in European fuel cell-powered vehicles.
  • Analyst at Truist gave Plug Power a Buy rating with a target price of $60. This target has already been hit since the stock is now worth $66 and in the pre-market is $68.

 

About Plug Power Inc

Plug Power Inc (NASDAQ: PLUG) is an American company involved in the development of hydrogen fuel cell systems that replace conventional batteries in electric vehicles and other equipment. The company was founded in 1997 and has its headquarters in New York.

Plug Power yesterday went up +13.4% along with other clean energy stocks such as FCEL +7.9% and QS +2.7%. The company has received a Buy rating from analysts at Truist. The coverage says that the company is actually doing a very good job with its hydrogen fuel cells which is why is receiving so many orders from major players. If this rally continues, the company will manage to become profitable in just a few years.

I can definitely see Plug Power growing in the following year and the next years to come. Consistent profitability would make the stock see further gains and it can bring more new investors in. We can see the market capitalization already big enough at 30.9 billion which is quite impressive. We talked about Plug Power in our WhatsApp group to our premium members way before the jump, if you were not part of it make sure you will be on the next one.

Latest News

Plug Power announced its new plans to launch a 50-50 joint venture with the French automaker Renault (OTCOK: RNLSY). The joint venture will be based in France for the research and development, manufacturing and sale of fuel-cell-powered vehicles and hydrogen solutions. The company has also mentioned that the joint venture aims to serve the fast-growing market of fuel cell light commercial vehicles, taxis and transportation.

The JV aims to get more than a 30% market share in European fuel cell-powered light commercial vehicles.

What is more, Plug Power has announced last week its strategic investment backup by South Korean SK Group of $1.5 billion commitment. The partnership is happening in order to accelerate hydrogen as an alternative energy source in the Asian markets. Their aim is to provide hydrogen fuel cell systems, hydrogen fueling stations and electrolyzers. 

The agreement between the two has SK Group agreeing in paying $1.5 billion strategic investment in Plug Power while acquiring 52 million common shares at a price of $29.9 per share. This represents approximately a 10% ownership stake. The joint venture will be based in Korea in order to help boost the Asian markets more efficiently as mentioned above. 

Ever since then, the stock keeps going up achieving a total of +102% in one week. The stock is now $66.02 from $33 since last week and pre-market shows a 4% increase to $68.78.

plug power stock chart

In the above chart, we can clearly see the price rise in a few days along with the market cap increase.

From what we can see both news are good for the company which managed to drive the stock price up. As Jim Cramer said, “I used to be a hydrogen doubter, now you can say I am a hydrogen believer and I believe in the Plug Power solution to make it all happen”.

However, is important to mention that Elon Musk, CEO of Tesla has already expressed his opinion on hydrogen as “mind-bogglingly stupid”. This is a clear sign of a controversial opinion regarding fuel but in the latest Model Y images on Twitter, some people were able to spot LiDAR technology implementations. Waiting on announcements to see if Elon changed his mind.

Bottom Line

Even though the stock price rise is justified by the good news around it, this does not erase the fact that the stock has jumped a lot in just one week. FDGT is waiting for the stock to have a correction in order to balance its hype in the following weeks. If of course, the company does not come up with more fundamental news! We at FDGT Academy suggest that those who did not buy Plug so far should expect an entry price lower than the current one even if this means waiting for a longer time. Overall, our team has a strong buy belief in the long run for this company. For those who already hold shares you can expect a rise in the stock price today as well however remember sometimes is good to realize some profits!

Disclaimer  I/we have no position in any stock mentioned. I wrote this article myself, and it expresses my personal opinions. I am not receiving any compensation for it, other than FDGT Academy. I do not have or had in the past any business relationship with any company that is mentioned in the above article.

Natalia C. - Junior Analyst at FDGT Academy

Natalia C. - Junior Analyst at FDGT Academy

I am a stock analyst/investor with prior experience and knowledge to BSc Accounting and Finance. After completing my degree and exposure to the accounting firms I decided that the direction I should choose is towards the Investment world. I completed my masters in Investment Management where it gave me solid fundamentals to build my career on. I have examined a lot of different aspects of investment, from REITS, derivatives, currencies, bonds, equity and hedge funds. I never stopped learning about the market which is why I can analyze and write articles for FDGT community always personally opinionated. My passion are green energy and electric vehicles stocks as a whole. I also had my share of analyzing the work form home stocks that are coming to take over in the upcoming years.