Plug Power (NASDAQ:PLUG), a provider of hydrogen fuel cells, is having quite the rebound year in 2019. If you bought PLUG stock on Dec. 31, you’ve doubled your money as of May 1. That’s quite a turnaround from the 47% downturn in 2018.

Several factors account for its move in 2019. The question is whether it’s enough to keep PLUG stock moving higher as we enter the summer doldrums of trading.

With Plug Power’s first-quarter 2019 earnings report on deck for May 8, the bigger question for shareholders who bought toward the end of last year and are sitting on significant gains ought to be whether they should sell before the release of its earnings or hold tight buying more on any weakness after the report.

Here’s the case for and against holding through earnings.

The Case for Buying PLUG Stock

Although Plug Power isn’t profitable, it’s getting closer on a non-GAAP basis. Meanwhile, on the top line, it continues to grow revenues in a big way. In fiscal 2018, PLUG stock grew sales by 74% to $174.6 million. In Q4 2018, it increased revenues by 92% to $59.8 million, a sign the company’s accelerating sales and adding customers.

In the fourth quarter alone, Plug Power delivered fuel cell products to 15 different customers including Amazon (NASDAQ:AMZN), Walmart (NYSE:WMT) and BMW (OTCMKTS:BMWYY). Most recently, it announced that it signed an agreement with Michigan-based Lipari Foods, a distributor of unique food and beverage products in 15 states.

Another example of the growth Plug Power’s experiencing: In 2018, it provided approximately 16 million hydrogen fills to its customers, up from 10 million at the end of 2017, a 60% growth rate.

As for the upcoming first-quarter results, Plug Power is expected to have revenues of $32.9 million, 13% higher than a year earlier. On the bottom line, it’s expected to lose eight cents a share, 11% higher than the seven cents it lost in the same quarter a year ago.

Yes, it’s a little higher. However, CEO Andy Marsh believes it will start making consistent EBITDA profits beginning in the third quarter. As a speculative bet, if you bought near $1, and believe that the potential for growth is real, I don’t know how you can’t buy more no matter the results on May 8.

The Case for Selling Plug Power Stock

I think the most significant negative for Plug Power other than the stock’s been on a tear and is due for a bit of cooldown is if it delivers revenue growth below the analyst consensus of 13%.

How likely is this?

I don’t have a crystal ball but given it grew Q4 2018 revenues by 92% and analysts expect 30% year over year growth in the second, third, and fourth quarters of 2019, I’d say the odds are relatively low.

The problem with taking profits if you bought in December is that you won’t get the capital gains rate of tax payable because you haven’t owned PLUG for more than a year. Instead, you’ll pay the rate of tax you pay on your regular income. In this situation, I wouldn’t sell it unless you don’t want to own it anymore.

If, however, you’re holding the stock in a tax-deferred or tax-free account, and you’re worried about a cooldown, I’d sell before May 8 and then buy back in after the results are out regardless of whether it goes up or not.

Bottom Line on PLUG Stock

Plug Power has an agreement with Amazon to buy $600 million of its fuel cells for the e-commerce company’s forklifts. As part of that agreement, Amazon has warrants to purchase 55.3 million shares of PLUG at different prices based on purchases made by the e-commerce company.

If it exercises all of the warrants, it will own 23% of Plug Power. The option and purchase agreement act as an artificial floor for the stock providing investors with a greater amount of security than would typically exist for a sub-$3-stock.

That’s a big bonus. 

Should you sell before earnings?

If you thought it was a 3-5-year hold at the end of 2018, I don’t think anything’s changed to shake you out of your position. I’d hold through earnings, buying more if it drops by any material amount.

As of this writing, Will Ashworth did not hold a position in any of the aforementioned securities.