TLDR
- Plug Power stock has climbed for 10 straight days, roughly doubling in value to $2.82
- Craig-Hallum raised price target from $2 to $4, citing business inflection point and growth outlook
- Heights Capital Management may exercise warrants for 185 million shares at $2 each, bringing $370 million to company
- Company lost $2.1 billion in 2024 and projected to lose $677 million in 2025, but targeting profitability by 2026
- More than 40% of shares are sold short, raising potential for short squeeze driving recent gains
Plug Power shares continued their impressive run Tuesday, marking the tenth consecutive session of gains that has roughly doubled the hydrogen technology company’s stock value. Trading at $2.82, the stock gained 6.4% and shows no signs of slowing down.
The rally began earlier in September and has caught many investors by surprise. Over the 10-day period, shares have climbed from around $1.40 to current levels, representing gains of more than 100%.
Craig-Hallum analyst coverage played a key role in the recent momentum. The firm doubled its price target from $2 to $4 while maintaining a Buy rating on the stock.
The upgrade followed meetings between investors and Plug Power’s CFO Paul Middleton and VP of IR Roberto Friedlander in the Midwest. This marked Middleton’s first non-deal roadshow since joining the company in 2014.
The timing wasn’t coincidental. Middleton had purchased 1 million shares during May and June, showing confidence in the company’s direction.
Warrant Exercise Could Provide Cash Boost
Heights Capital Management disclosed Monday it may exercise warrants for up to 185 million Plug Power shares at $2 each. This move could inject approximately $370 million in cash into the company’s coffers.
The potential cash infusion helps explain Monday’s 22% jump in share price. The funds would give Plug Power more flexibility to address its debt-heavy balance sheet.
The company has been working to optimize its cost structure through headcount reductions and facility consolidation. These moves aim to improve margins and cash usage metrics.
Financial Challenges Remain Despite Recent Gains
Plug Power’s financial picture remains challenging. The company lost $2.1 billion in fiscal 2024 and analysts project losses of around $677 million for 2025.
The hydrogen fuel cell provider hasn’t posted an annual profit in its 26-year history as a public company. This track record explains why more than 40% of outstanding shares are currently sold short.
The heavy short interest raises questions about whether recent gains represent a short squeeze. When short sellers are forced to buy back shares to cover positions, it can create rapid price increases.
Craig-Hallum believes the company is at an inflection point. The firm expects revenue to accelerate, particularly in the electrolyzer segment, as Plug Power transitions from hyper-growth mode to focused execution.
Path to Profitability Timeline Set
Management has set clear financial targets for the coming years. The company aims to achieve gross margin positivity by the end of 2025.
EBITDA positivity is targeted for the end of 2026. These goals represent important milestones for a company that has struggled with profitability throughout its existence.
Plug Power is scheduled to report third-quarter earnings on November 11. This report will provide investors with updated financial metrics and progress toward stated objectives.
Analyst price targets currently range from $0.55 to $5.00, reflecting the wide range of opinions about the company’s prospects. The recent rally has pushed the stock closer to the higher end of these estimates.
The company has also extended its at-the-market sales agreement with B. Riley Securities, allowing share offerings worth up to $1 billion through August 2027.
