Why Plug Power, Bridgepoint Education, and Nuverra Environmental Solutions Plunged Today

Tuesday brought further losses to the stock market, with somewhat steeper and broader-based declines than investors saw on Monday. Even though most major-market benchmarks lost only about half a percent, the brunt of the selling pressure seemed to center on some of the best-performing stocks in the recent past. Among the stocks that performed the worst today were Plug Power (NASDAQ: PLUG  ) , as well as Bridgepoint Education (NYSE: BPI  ) and Nuverra Environmental Solutions (NYSE: NES  ) .

Plug Power plunged more than 40% after becoming the latest target of Citron Research, which penned a report that questioned the fuel-cell systems company's business model and suggested that the stock's fair value was just $0.50 per share. The report described a long history of statements from CEO Andy Marsh relating to unit sales that turned out to be overly ambitious, and pointed to large and in hindsight ill-timed offerings of shares and convertible securities at very low prices. Ballard Power Systems (NASDAQ: BLDP  ) , which has a closer relationship with Plug Power, also fell hard on the news, losing more than a quarter of its value. FuelCell Energy (NASDAQ: FCEL  ) was also a victim of the dour view of the industry, falling 17% despite initially rising after reporting earnings last night that included a 22% jump in sales.

Bridgepoint dropped 16% as the for-profit educational company fell well short of investor expectations in its latest earnings report. Revenue fell by almost 22% on an identical percentage drop in total student enrollment at Bridgepoint's Ashland University and University of the Rockies. Despite an encouraging increase of about 10% in new-student enrollments, the company's loss defied expectations of a small profit for the company. Other for-profit educational institutions fell in sympathy, and it's clear that the challenges for the industry are far from over even though hopes for a turnaround have gotten more frequently lately.

Nuverra slid 15% after the company's earnings release last night. Revenue for the unconventional oil-and-gas environmental services specialist fell by about 5% sequentially from the third quarter, as tough weather hurt the company. In addition to earnings, Nuverra announced it would sell its Thermo Fluids division to VeroLube for $175 million, with all but $10 million coming in cash. Investors might not have been thrilled with the sale, simply because the price represents a $70 million loss compared to what Nuverra paid for the business just two years ago. Yet Nuverra's sale is part of its broader strategy to focus on its shale-play environmental solutions business, and many believe that a more focused approach should bring better long-term results for the company. With Nuverra also having resolved some other old issues, including settlement of class action litigation and a transition in the board of directors, the stock could rebound eventually from today's losses.

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Comments from our Foolish Readers

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  • Report this Comment On March 11, 2014, at 9:53 PM, TheStockDoctor wrote:

    Whew. I thought it was the hatchet job that theMotleyFool did this morning.

  • Report this Comment On March 12, 2014, at 12:41 AM, Ustauber wrote:

    PLUG got Unplugged !!


  • Report this Comment On March 12, 2014, at 4:59 AM, activin1 wrote:


    I would have liked to get also your view on the outlook of PLUG, FCEL and not just a report that the stocks declined.

  • Report this Comment On March 12, 2014, at 8:14 AM, HvyOnEzFool wrote:

    Is the Citron Research article a reaction to an eminent fear (aka short squeeze) of getting plugged????

    One thing is for certain, it confirms Jim Crammers comment “Yes the market is rigged, but you can still win”!

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Dan Caplinger

Dan Caplinger has been a contract writer for the Motley Fool since 2006. As the Fool's Director of Investment Planning, Dan oversees much of the personal-finance and investment-planning content published daily on With a background as an estate-planning attorney and independent financial consultant, Dan's articles are based on more than 20 years of experience from all angles of the financial world.

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