Sell Rating for Plug Power Amid Financial Challenges and Uncertain Future Funding

Analyst Andrew Percoco of Morgan Stanley maintained a Sell rating on Plug Power (PLUG – Research Report), reducing the price target to $0.50.

Andrew Percoco has given his Sell rating due to a combination of factors impacting Plug Power’s financial outlook and strategic positioning. The company’s recent quarterly results fell short of expectations, with gross margins significantly lower than consensus estimates and a higher-than-anticipated cash burn. These financial challenges are compounded by the uncertainty surrounding future funding, as the discontinuation of the 45V clean hydrogen production credit poses a threat to the viability of Plug Power’s green hydrogen projects.
Additionally, while Plug Power has secured a new credit facility to manage its existing debt, the need for accelerated spending on future projects amid uncertain Department of Energy funding creates further financial strain. These factors have led to a downward revision of the price target, reflecting the increased risks and challenges the company faces in achieving its growth objectives.

In another report released on May 14, Piper Sandler also maintained a Sell rating on the stock with a $0.80 price target.