Fuel cell maker and green hydrogen producer Plug Power (PLUG 2.80%) announced a new partnership today, and the stock popped in Wednesday morning trading. But the early 4% gain reversed course, and Plug shares slipped down as much as 1.6% by noon. As of 1:06 p.m. ET, the stock had settled to a 0.5% drop.
Plug shares have been active since last week, when the company announced a new deal with existing customer Walmart to supply the retailer up to 20 tons per day of green hydrogen to power its warehouse and distribution center forklifts. Today, Plug Power said it will supply MOL Group with a 10-megawatt electrolysis unit for the European energy company to produce its own green hydrogen.
MOL, an integrated energy company, will utilize Plug's electrolyzer to build one of the largest green hydrogen production plants in Europe. It plans to produce 1,600 tons per year of green hydrogen at the company's Hungary refinery. Green hydrogen is produced using only renewable energy to power the electrolyzer in the process.
This morning's initial stock move likely came from the excitement investors had with the Walmart news. Today's announcement is more of an equipment sale, which may have been what resulted in the stock's reversal.
Plug Power CEO Andy Marsh said in a statement, "Our opportunities seem limitless to support the trend to pull green hydrogen into more traditional industrial hydrogen markets throughout the world." It's clear the company is on a path to grow the hydrogen economy -- especially green hydrogen production. But investors may have initially put more significance on today's announcement than was warranted. That helps explain why shares gave up early gains.