![]() ![]() Wall Street also forecasts that PLUG's losses at the non-GAAP adjusted EBITDA level will narrow from -$180 million last year to -$17 million in the current year. Market consensus sees Plug Power's top line expanding by +80% YoY from $499 million in fiscal 2021 to $899 million in FY 2022, according to sell-side financial estimates sourced from S&P Capital IQ. Heading into 2022, PLUG stock is expected to deliver higher revenue and narrower losses. This is why I have turned bullish on the name. I see increased revenue and narrower operating losses for PLUG in 2022, and its current valuations are attractive as compared to peers. I focus on Plug Power's outlook this year in this latest article. My prior initiation article for Plug Power was published on September 30, 2021. I raise my investment rating for Plug Power Inc.'s ( NASDAQ: PLUG) shares from a Hold to a Buy. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.Onurdongel/iStock via Getty Images Elevator Pitch On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. On the other hand, it’s not guaranteed that Plug Power will reach its full-year revenue target range.īesides, skeptical investors should question whether Plug Power is truly on a “path to profitability.” Thus, for the remainder of this year, financial traders would be wise to avoid PLUG stock. It’s fine to acknowledge Plug Power’s relatively robust quarterly sales. So, the hard facts don’t seem to support Plug Power’s positive spin job. The company’s net loss in Q2 of 2023, however, was $236.4 million. In the year-earlier quarter, Plug Power incurred a net earnings loss of $173.3 million. Let’s see if Plug Power is actually on a “path to profitability,” though. Three different times, Plug Power used the phrase “path to profitability” in its second-quarter investor letter. Nevertheless, Plug Power’s management decided to put a positive spin on the company’s bottom-line results. In actuality, Plug Power lost 40 cents per share. ![]() Wall Street wasn’t particularly optimistic, as analysts predicted that Plug Power would report a quarterly earnings loss of 27 cents per share. Moreover, Q2 2023 continued the pattern of this unfortunate track record for Plug Power. I hate to be the bearer of bad news, but Plug Power has a consistent track record of missing analysts’ quarterly earnings per share (EPS) estimates. This is, in my estimation, a setup for disappointment in the coming quarters. Therefore, Plug Power will somehow need to post unusually strong quarterly sales figures in order to reach $1.2 billion to $1.4 billion for the full year. Furthermore, the company reported only $210.3 million in first-quarter 2023 sales. Mathematically, if all four quarters were like Q2 (with $260.2 million in revenue), then Plug Power would only generate $1.04 billion in full-year 2023 sales. It’s fine to be optimistic, but Plug Power also needs to be realistic. Looking ahead, Plug Power expects to generate full-year 2023 revenue in the range of $1.2 billion to $1.4 billion. As it turned out, Plug Power generated revenue of $260.2 million, thereby beating Wall Street’s forecast of $237.7 million. To be fair and balanced, I must acknowledge a bright spot in Plug Power’s second-quarter 2023 earnings results. All in all, PLUG stock is vulnerable to a sharp drawdown despite the management’s apparent optimism. For instance, Plug Power is reportedly borrowing as much as $1.5 billion to fund the construction of hydrogen plants.īut then, borrowing money could put negative pressure on Plug Power’s financials - which, as we’ll discover, aren’t ideal. It’s certainly one of the most ambitious players in the green hydrogen space of the 2020s. The point here isn’t to disrespect Plug Power as a company. After delving into the data, financial traders should seriously think about avoiding PLUG stock. That’s fine, but it means that investors should view Plug Power’s (NASDAQ: PLUG) latest earnings letter with a skeptical eye. When a company issues a quarterly press release, typically it will put a positive spin on the company’s recent performance.
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