Can anything stop the momentum of Plug Power (NASDAQ:PLUG) and PLUG stock? Plug Power stock has more than doubled since the end of October, jumping 119% from $14 a share on Oct. 30 to $30.69 at the time of writing. Year-to-date, the stock is up a massive 871%. In January 2020, Plug Power was a penny stock, changing hands at just $3.24 a share.
The powerful trajectory has been due to the green shift that is underway in the U.S. and likely to accelerate under the administration of Democratic President-elect Joe Biden. Biden has vowed to ween Americans off fossil fuels and lead them to an environmentally friendly future. Stellar earnings results have also lifted the stock price higher.
The Right Company at the Right Time
Latham, New York-based Plug Power is right in the thick of the green revolution that’s now underway. The company manufactures hydrogen fuel-cell systems that replace the conventional batteries used in equipment and vehicles. Plug Power is positioned for big growth over the next decade, as the global economy switches to electric vehicles and looks to lessen the reliance on fossil fuels as a primary power source.
Furthermore, the company has attracted investments over the past year from leading brands such as Amazon (NASDAQ:AMZN) and Walmart (NYSE:WMT) — investments that have provided a boost of confidence to PLUG stock.
Today, Plug Power’s electric indoor forklifts that are being used by companies ranging from Home Depot (NYSE:HD) to Kroger (NYSE:KR) — another vote of confidence. Equally important, automakers such as Toyota (NYSE:TM) are now looking at Plug Power’s hydrogen fuel cells for use in their electric vehicles. The fuel cells have multiple applications, including in the transportation, telecommunications and utility sectors.
Impressive Financial Results
Plug Power is not a new company or the latest flash in the pan on Wall Street. The company has been in continuous operation since 1997. However, its financial situation has been especially strong in the most recent year. The company’s 2020 third-quarter results were stellar and pushed the stock higher in November.
Gross billings were $126 million in the third quarter, up 106% from the same period of 2019. Equally impressive to analysts was the fact that Plug Power’s management team raised its 2020 gross billings forecast to $328 million from $310 million previously, and is now targeting 2021 gross billings of $450 million.
In February 2020, Plug Power introduced a brand new 125 kilowatt fuel cell for engines found in Class 6, 7 and 8 trucks and heavy duty off-road equipment. This will open up a new market and revenue stream for the company. PLUG also signed several contracts in recent months. The company has put in place GenDrive fuel cell contracts for European industrial and material handling vehicles. And it has partnered with Apex Clean Energy to develop a green hydrogen network across the U.S. that uses wind power.
Plug Power Stock Is a Buy
Plug Power is charged for growth. The company’s hydrogen fuel-cell technology is attracting a lot of interest, and a friendly administration in the White House is likely to further benefit the company.
While the share price has enjoyed an astronomical run this year, it still remains within reach of most investors at just about $30 a share. However, it is unlikely to remain at current levels for long. After consolidating, investors can expect PLUG stock to continue running higher. Investors should take a position now. Plug Power is a buy.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Joel Baglole has been a business journalist for 20 years. He spent five years as a staff reporter at The Wall Street Journal, and has also written for The Washington Post and Toronto Star newspapers, as well as financial websites such as The Motley Fool and Investopedia.
