Is Plug Power (PLUG) Stock a Buy Right Now?


  • Plug Power (NASDAQ:PLUG) dropped 13% today on news that climate investments may be off the table.
  • Sen. Joe Manchin is reportedly blocking renewable energy investments in favor of deficit reduction.
  • This legislation has been key to the investment thesis for PLUG stock, leading to today’s decline.
PLUG stock - Is Plug Power (PLUG) Stock a Buy Right Now?

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It has been an incredibly volatile month for investors in clean energy stocks like Plug Power (NASDAQ:PLUG). Today, PLUG stock is down 13% on news that Sen. Joe Manchin is at it again, creating another roadblock for Democrat-led climate spending. It appears all of the climate-related initiatives included in the Build Back Better plan are being blocked by Manchin, with his focus instead on passing prescription drug reform and extending the Affordable Care Act.

Manchin’s view is that federal spending has been a key driver of high inflation. And no matter where one is on the political spectrum, inflation is clearly a problem. Thus, it appears the view of many in Congress is that tackling the budget deficit, and therefore inflation, is a higher priority than making long-term investments in the clean energy sector.

With that in mind, let’s dive into how this news affects the investment thesis around Plug Power.

Is PLUG Stock a Buy Right Now?

Today’s dramatic decline in PLUG stock highlights the importance of this expected legislation. Hydrogen companies such as Plug Power have banked on receiving federal support to grow. Without such support, it’s unclear how and when this industry will scale.

Thus, the political risk with PLUG stock is much higher than with many other renewable energy companies.

With that said, there are analysts who believe PLUG stock may be enticing at these levels. BTIG’s Gregory Lewis recently maintained a “buy” rating on this hydrogen stock with a $40 price target, implying 160% upside from today’s levels. Susquehanna analyst Biju Perincheril also has a positive view on the stock, with a price target of $30 per share (approximately 100% upside). And while some, including analysts at JPMorgan and KeyBanc, have lowered price targets on Plug Power, the consensus on Wall Street at least is that this stock could double from here.

I’m not so sure.

On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.

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