Why Is Plug Power (PLUG) Stock Down 7% Today?

  • Shares of Plug Power (PLUG) stock are down big today following a shareholder presentation yesterday.
  • The company released its 2022 guidance, which appears to be materially lower than expected.
  • While some of this revenue is likely to be pushed forward, investors don’t seem to like the story right now.
PLUG stock - Why Is Plug Power (PLUG) Stock Down 7% Today?

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With all major indices up at the time of writing, many investors may be paying the most attention to today’s winners. That said, there are a few notable decliners today that are worth noting as well. Investors in Plug Power (NASDAQ:PLUG) are unfortunately seeing some of the biggest declines today, with PLUG stock losing more than 7% in early afternoon trading today.

Today’s move lower appears to be directly tied to a shareholder presentation given by the company yesterday. The slides were released via a form 8-K for all investors to view and digest. Overall, the nuts and bolts of this presentation appear to be centered around the idea that growth hasn’t materialized as many expected.

Plug’s 2022 summary indicates that growth of 45%-50% is likely, compared to expectations of approximately 80% growth for 2022. Supply chain challenges with launching new products and having larger projects completed in 2023 were cited as reasons for this decline.

On a forward-looking basis, the company ran through its prospective growth projects for 2023 and beyond. However, investors appear to be taking the view that these capital-intensive projects may be in harm’s way.

Let’s dive into what investors may want to make of this presentation and today’s move.

PLUG Stock Sinks on Operational Update

Any sort of pre-announcement when it comes to earnings is going to be watched closely by investors. Indeed, a revenue growth miss to this degree, given Plug’s relatively small size, is likely to be viewed very negatively.

Accordingly, in some respects, I think today’s price action isn’t all that bad. There’s been demand for PLUG stock at these lower levels, and shares are actually rising at the time of writing.

Some of this positive sentiment may be driven by the idea that delayed demand may be pushed into 2023. With supply chain issues improving, perhaps this year may prove more positive for growth than last. Indeed, the transition toward renewable energy only appears to be picking up steam, as nation states look to bolster their energy security.

Time will tell how PLUG stock performs from here. As an unprofitable green energy company, I’m uncertain on how investor demand will shift over time. For now, this is a stock that I think deserves a spot on the watchlist, at the very least.

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 InvestorPlace.com 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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