⚡Plug Power: Trouble In Paradise?

GameStop misses on earnings. Intel is building a new plant!

Hey Global Investor, here’s what you need to know before the US markets open.

Market Snapshot 📈

S&P 500 (Yesterday’s Close) 3,910.52 −30.07 (0.76%)

NASDAQ (Yesterday’s Close) 13,227.70 −149.84 (1.12%)

FTSE 100 (5 PM IST) 6,681.16 −18.03 (0.27%)

NIFTY 50 (Today’s Close) 14,549.40 −265.35 (1.79%)

USDINR (5 PM IST) 72.60 (1 Year -4.98%)


🔥 Top Movers

LABD +17.36%
SOLY +10.94%
TZA +10.83%

FREQ -77.98%
UPST -28.14%
IONS -21.66%


⚡Plug Power: Trouble In Paradise?

A class-action lawsuit has been filed against Plug Power (PLUG) for accounting errors, leading to a decline in stock value. (Tweet This)

Founded in 1997 in NY, the hydrogen and fuel cell company provides zero-emission solutions for a sustainable future. Plug went public in 1999 and presently has a market valuation of $21.6B. The company raised $2.2B in funding and even acquired Amazon (AMZN) and Walmart (WMT) as clients. But what the company still lacks are profits.

With action against climate change gaining a renewed push under the Biden administration, clean energy solutions are more sought after. The plug has been gaining popularity and investor love in the past few years with the rise of EVs and clean energy. The company surged over 1000% just in 2020, despite operating at a loss and having a debt of over $600M.

Plug had a great start in 2021, surging 100% in January, peaking at $75.49. Plug also formed a joint venture with Renault SA to build hydrogen-fueled delivery vans in Europe. The company was also set to build the largest green hydrogen plant in the USA. A bullish first couple of months for Plug, until a sudden turn of events shook any complacency that was building up!

What Happened?
A lawsuit filed against the company alleges that Plug Power and its senior executives misled investors and failed to provide them with significant information. Plug was supposed to inform investors that: (a) it couldn’t file the 2020 annual report on time due to internal review delays and (b) report material weaknesses in its internal control over financial reporting.

The accounting errors have spotlighted the company’s transparency, leading to a decline in stock as some investors lost trust. Nasdaq has issued a notice to reissue financial statements of fiscal years 2018, 2019 and quarterly filings for 2019 and 2020.

This situation on the company’s financials notwithstanding, JP Morgan has backed the stock, and analysts believe the aforementioned accounting errors are just a speed bump for Plug. The company is expected to be profitable by 2024/25. A lot depends on whether any other skeletons tumble out of the closet as the lawsuit moves forward. Plug, for its part, is projecting confidence it will emerge unscathed from this episode with minimal fallout. The reality probably is somewhere in the middle. If so, it might still be a net positive for Plug.

Market reaction:PLUG ended the day at $36.79, down 5.45%; in pre-market trading, the stock is up 1.39%.

Company Snapshot 📈

PLUG $36.79 -2.12 (-5.45%)

Analyst Ratings (15 Analysts) BUY 73%   HOLD 20%   SELL 07%

Newsworthy 📰

Game Over?: GameStop misses earnings, names new COO, focuses on digital (GME –6.55%)

Chips!: Intel is spending $20 billion to build two new chip plants in Arizona (INTC  -3.28%)

Charger?: Brazil fines Apple $2 million for not including charger with iPhone 12 series (AAPL -0.69%)


Later Today 🕒

  • Before Market Open: Enerpac Tool Group Corp Earnings (EPAC)
  • After Market Close: Riot Blockchain Inc Earnings (RIOT)
  • 6:00 PM IST: Durable goods orders
  • 7:15 PM IST: Markit PMI (preliminary)


Fun Fact of The Day 🌞

Elephants communicate through vibrations.

Disclaimer: The content of this article has been created and published by Winvesta India Technologies Pvt. Ltd., in order to ease the reader’s understanding of the subject matter. The information and/or content (collectively “Information”) provided herein is general information sourced through various news reports and does not constitute a research report or a research analysis. The Information is not intended to offer advice, target or solicit any particular customer or group of customers to buy or sell securities. 

Winvesta does not render any research or advisory services and provides a more detailed description of its services on its website and mobile application along with the terms and conditions published therein from time to time. While reasonable care has been exercised to ensure that the Information is adequate and reliable, no representation is made by Winvesta as to its accuracy or completeness and Winvesta, its affiliates, subsidiaries and employees accept no liability of whatsoever nature for any direct or consequential loss, including without limitation any loss of profits, arising from reliance on this Information. Neither Winvesta nor any of its affiliates are acting as an investment adviser, research analyst or in any other fiduciary capacity. Accordingly, reader’s are expected to undertake their own due diligence in consultation with their own advisors and are advised not to solely rely on the Information. Any such reliance shall be at the reader’s own risk. 

All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. There is always the potential of losing money when you invest in securities, or other financial products. Investors should consider their investment objectives and risks carefully before investing.

Start Building Your Global Portfolio Today

Download Winvesta App now to Get Started