The Plug Power stock soared by more than 7% after the company released mixed quarterly results. The shares rose to $31.80, bringing its total market capitalization to more than $18 billion. They have risen by more than 480% in the past 12 months.
Plug Power earnings
Demand for alternative power sources has jumped in the past few years as the world starts to move past fossil fuels. This has seen companies like Tesla, QuantumScape, and Nio do relatively well in public markets.
Plug Power is another company that is hoping to become a leading player in the energy sector in the United States. The company provides hydrogen solutions mostly to the automotive industry. It has already deployed more than 40,000 fuel cell systems mostly in the United States. Some of its customers are companies like Amazon, Walmart, and BMW.
Plug Power delivered its quarterly results on Tuesday. Its revenue rose by 76% year-on-year, beating consensus estimates. However, the compay also released a bigger loss than estimated. Its loss came in at more than $60 million, which is equivalent to $0.12 per share.
By segments, its fuel cell systems revenue rose by 128% to $46.5 million while its gross margin rose to 38%. It now expects that its big factory being built in New York to be complete by fall. So, is the Plug Power stock a buy or sell?
From a fundamental perspective, Plug Power seems like a highly overvalued company considering that it has a market capitalization of more than $18 billion. It is also a high risk company to invest in since it is still unclear whether the hydrogen industry will catch-up. If it does, then there are higher chances that the company will maintain a key role.
Analysts are generally optimistic about the Plug Power stock price. In a note in May, analysts at morgan Stanley said that its stock will rise to $36. Those at BTIG and E.Riley expect it to rise to $40 and $50, respectively. Those at Barclays and Piper Sandler are less optimistic.
Plug Power stock price forecast
Turning to the daily chart, we see that the PLUG stock price has dropped by about 60% from its highest level this year. We also see that the shares are at the same level as the 61.8% Fibonacci retracement level and the 50-day and 200-day moving average. Further, the Plug Power stock has risen by more than 67% from its lowest level on May 11. It also seems to be forming an inverted head and shoulders pattern. Therefore, the stock could keep rising as bulls target the 50% retracement level at $38.