After gaining 14% on the heels of its first-quarter 2021 financial results yesterday, Plug Power (PLUG 0.54%) stock has reversed course today. As of 12:15 p.m. EDT, Plug Power shares are down 3.9% after having dropped as much as 6% earlier in the session.
The mixed earnings report included a sharp 76% increase in revenue versus the year-ago period along with a jump in costs and continued bottom-line losses. Today, an analyst with Canaccord Genuity decided the company didn't deserve his previously optimistic outlook after the report. Jed Dorsheimer downgraded Plug Power shares from buy to hold and slashed the firm's price target by more than half to $31 per share, as reported by Benzinga.
Plug Power has plans in place to grow infrastructure for hydrogen as a fuel source, but investors may be getting impatient with the company's continued net losses along the way. Plug Power has announced plans for three new green hydrogen plants in the U.S. and has begun a joint venture with French automaker Renault, hoping to gain 30% market share for hydrogen-powered light commercial vehicles in Europe by 2030.
Analyst Dorsheimer said, "The company's costs are trending higher than previously expected as it begins to focus on the execution of multiple projects simultaneously at different stages," according to the report. He added that the company's valuation is outpacing its performance and that he wants to see improvements toward profitability.
Investors in the $18.5 billion market cap company seem to agree today, and they may be waiting to see the company's growth projections, and a profit, materialize before bidding it higher.