Please ensure Javascript is enabled for purposes of website accessibility

Why Plug Power Stock Bounced Back Today

By Rich Smith – Sep 21, 2021 at 11:14AM

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

Evercore sees a $9 billion future for Plug Power.

What happened

Shares of hydrogen fuel cell company Plug Power (PLUG 1.19%) tumbled in Monday trading as investors reacted to a broad-based S&P 500 sell-off and an announcement from Plug Power that it will be investing heavily over the next several years to develop a string of liquid hydrogen production plants stretching from New York to California.

But as it turns out, Plug wasn't the only company with news about Plug to report. That news caused Plug Power to bounce up 2.3% as of 9:40 a.m. EDT Tuesday.

Simple green arrow going up.

Image source: Getty Images.

So what

In a "flash note" that came out over the weekend, analysts at Evercore made an aggressive bull case for why new legislation in Congress could help lift Plug Power stock -- currently selling for $26 and change -- as high as $42 a share within a year, or even higher, potentially more than doubling the stock price to $64 a share. As Evercore explained in a note covered by, should either the $1 trillion infrastructure bill passed by the Senate (but not yet by the House), or the $3.5 trillion social infrastructure bill (not yet passed by either house of Congress) become law, it would be a big boon to Plug Power's business.

Plug Power's bounce today may be tied to the rebound in the S&P, or to investors learning what Evercore had to say Sunday, or both.

Now what

Evercore gives passage of the $1 trillion infrastructure bill a 65% to 75% chance of being passed, and says that even if only this bill becomes law, the analyst has "confidence" that the $10 billion in subsidies it directs toward hydrogen power will boost hydrogen demand to the point that Plug could be doing $9 billion in annual revenue by 2030. Evercore doesn't say how much bigger the business would become upon passage of the $3.5 social infrastructure bill (and notes that one only has a 30% to 40% chance of passing in any case). But it would seem to be quite valuable.

Indeed, Evercore says that if both bills become law, Plug Power stock could hit $64 a share within a year.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Premium Investing Services

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