Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

Why Plug Power Stock Continued to Climb Today

By Howard Smith - Jan 8, 2021 at 2:12PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The hydrogen fuel cell company is getting tailwinds from several places.

What happened

Yesterday, shares of Plug Power ( PLUG -8.13% ) rocketed 35%. The gains continued today with shares up another 11% as of 2 p.m. EST. 

The 50% jump in the past two days still pales in comparison to the stock's almost 1,600% rise since the start of 2020. 

So what

The recent spurt was triggered by an announcement of a new strategic agreement with South Korea's SK Group that will inject $1.5 billion into the company in exchange for a 10% stake for SK Group. 

hydrogen fueling station

Image source: Getty Images.

The partnership plans to "provide hydrogen fuel cell systems, hydrogen fueling stations, and electrolyzers to the Korean and broader Asian markets." 

Now what 

Further support for the sector has come in recent days as the Georgia runoff elections cemented Democratic control of both houses of Congress. Investors believe federal support to help build out green energy infrastructure is now more likely. 

But the stock's outsized gain over the past year has also come with share dilution to investors. 

PLUG Chart

PLUG data by YCharts

Shares outstanding have grown by more than 40% as the stock rose to its current market capitalization of over $20 billion. For a still unprofitable company, that's a valuation based solely on potential. But the potential market could be huge. Investors should monitor Plug Power's upcoming business update on Jan. 26 to see if it can provide a current timeline toward profitability, and decide if the valuation seems justified in this fast-changing industry. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Plug Power Inc. Stock Quote
Plug Power Inc.
$33.46 (-8.13%) $-2.96

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/06/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.