One Wall Street Analyst Says Plug Power Stock Has 25% Upside

Last week, Plug Power (NASDAQ: PLUG) sent conflicting signals to investors in its quarterly report: One negative aspect is that Plug lost $2.30 per share in 2023 after missing revenue and profit projections

 However, there is "no longer substantial doubt of the Company’s ability to continue as a going concern" according to Plug, who emphasized that the company has enough "liquidity" due to its plans to issue and sell $1 billion worth of new stock and secure a new $1.6 billion loan from the Department of Energy.

Plug Power finished the day in the green after initially selling out on the loss. Craig-Hallum, an investment banking business, claims that this is simply the start. The banker is predicting that Plug Power stock, which is priced at $4.50 per share right now, may reach $5 per share in about a year, giving new investors a 25% payout.

Does Craig-Hallum's analysis hold water? While I acknowledge that everything is conceivable, I must admit that I am not very optimistic about Plug Power's ability to provide returns for investors.

Please understand. Assuming investors keep pouring money into the firm, Plug and Craig-Hallum are likely right that it can "continue as a going concern" at this point.

After spending $1.8 billion in cash last year, Plug should have enough to live for another 18 months provided it sells $1 billion in cash and receives an additional $1.6 billion in loans from the government.

The $1 billion in cash from that stock offering should be more than enough to keep the doors open for the next couple of quarters, even if Plug doesn't get its loan and just produces and sells a boatload of new shares.

The truth is that Plug Power has been around for almost 25 years without ever turning a profit. However, in the last quarter of a century, its value has plummeted by 99.7 percent, leaving all of its investors destitute.