Plug Power stock rallied early before dropping Friday, after an analyst upgrade and news Thursday that the hydrogen fuel cell provider landed a major green hydrogen deal in Europe.
Northland analyst Abhishek Sinha upgraded Plug Power stock to an outperform rating, up from market perform, on Friday. The firm has a 22 price target on PLUG, well above Thursday's closing price of 12.36.
Sinha wrote that Plug Power, which has yet to report a quarterly profit, appears to be on a "clear path to cash flow generation" with "every incremental deal announcement." The analyst added the firm sees break-even margins by the end of 2023 and that PLUG should generate cash flow next year.
PLUG shot up 4% early before slipping 1.7% to 12.15 Friday during market trade. On Thursday, Plug Power stock surged 7.5% to 12.36 after the company announced a deal for 100 megawatts of electrolyzers for a green hydrogen project in Europe.
Electrolyzers use electricity to split water molecules, effectively "refining" hydrogen from water. Hydrogen produced from water, using electrolyzers powered by renewable sources, such as solar, wind or hydro, is labeled "green" hydrogen.
Plug Power says electrolyzers deployed in the current deal will generate approximately 43 tons of green hydrogen per day. The green hydrogen will replace "gray" hydrogen (produced from natural gas or methane) in the oil refining process, according to the company.
Plug Power added the process will eliminate approximately 516 tons of carbon dioxide per day.
Plug Power Stock
On Tuesday, Plug Power announced it will supply two 5-megawatt electrolyzer systems for green hydrogen projects in Australia.
The fuel cell stock has gained 67% since May 15 lows of 7.39.
Plug Power stock went public in 2002. Based in Latham, N.Y., The company supplies hydrogen fuel cells mainly for forklifts in large warehouses. Its fuel cells replace conventional batteries in equipment and vehicles powered by electricity. Plug Power clients include retail giants Amazon, Walmart, Nike and Home Depot.
The company aims to become the largest green hydrogen generator in the world. As a first step, it wants to produce more than half of its hydrogen energy from entirely renewable sources by 2024. It also aims to branch out from forklifts to heavy-duty vehicles to serve ports in the U.S. and Europe, as well as stationary fuel cells to power data centers and distribution hubs.
Please follow Kit Norton on Twitter @KitNorton for more coverage.
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