Green energy investing is all the rage these days. Indeed, there are many reasons for investors to be bullish on this space.

Beside the obvious demand shift that is underway, green energy stocks have received extra attention of late in the political arena. Everything from hydro to wind and solar power are now in the purview of governments around the world.

However, one green energy sector that’s been waiting in the wings for quite a while for a boost has been the hydrogen sector. It’s a sector that’s been around for decades, but has seemingly always lacked that one catalyst that could take it over the edge.

President Biden’s recent infrastructure spending bills seek to change that. The Biden Administration has promised increased funding to various hydrogen-related projects on the horizon. Although the details remain murky, investors seem to like Plug Power (PLUG) as a key beneficiary (directly or indirectly) of this spending.

Let’s take a look at what sort of upside may be on the horizon for PLUG stock in this bullish environment for hydrogen plays today.

Technicals Looking Good For Plug Power Right Now

Momentum is everything in the market these days. And momentum is something PLUG stock hasn’t had a lot of, lately.

The green energy player has seen its share price plummet from more than $75 per share earlier this year to the $20 level a few weeks ago. (See Plug Power stock chart on TipRanks)

However, the good news for investors in PLUG stock is that the $20 price range appears to be holding as a key resistance level for this stock. Investors who bought PLUG stock around $20 per share have booked 50% gains in this company, as its stock has rocketed above $30 per share in recent days.

These moves result from a couple of key factors. Sentiment is improving in the hyper-growth space, as inflation concerns are increasingly being brushed off by the market as transitory. However, the bigger news for this stock relates to the company’s restatement of its financial statements, which took place mid-May.

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Restatement of Financials Bullish for Investors in PLUG Stock

When Plug Power announced its revised financials on May 14, PLUG stock shot approximately 8% higher.

Why did that happen?

Well, what was expected to be a potentially catastrophic downgrade of backwards-looking revenue turned out to be not bad at all.

In fact, the company reported an aggregate increase in revenue for the previous three years of approximately $6.5 million. This included a 2020 revenue increase of $7.2 million (to reduce the company’s net loss from $100.4 million to “only” $92.2 million). Both 2018 and 2019 revenue were reduced by $400,000 and $300,000, respectively.

Now, given how bad things could have been, this news was certainly cheered by investors. Accordingly, with this headwind out of the way, many investors appear to feel inclined to give PLUG stock another shot here.

Indeed, if investors liked this stock at $75, they surely must like it at the $20-$30 level.

It appears this restatement was a one-time event, and no malfeasance was at play from the company’s management team. Accordingly, many investors may tend to lean bullish on PLUG stock following this news. Assuming no more accounting changes on the horizon, PLUG stock could see some nice near-term momentum from here.

What Analysts Are Saying About PLUG Stock

According to TipRanks’ analyst rating consensus, PLUG stock comes in as a Moderate Buy. Out of 16 analyst ratings, there are 10 Buy recommendations, 5 Hold recommendations, and 1 Sell recommendation.

As for price targets, the average analyst Plug Power price target is $48.07. Analyst price targets range from a low of $24.00 per share to a high of $78.00 per share.

Bottom Line

Plug Power is a unique player in the high-potential nice hydrogen market. For clean energy enthusiasts, this may be an intriguing speculative play at these levels.

That said, risks do remain within this sector today. Significant scale has not yet been reached in hydrogen-powered clean energy projects. At least, not at a scale that rivals the growth in other clean energy sources as of yet. Accordingly, investors might want to remain on the sidelines with this name, until ubiquitous growth becomes evident.

Disclosure: Chris MacDonald held no position in any of the stocks mentioned in this article at the time of publication.

Disclaimer: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities.

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