What happened
Plug Power (PLUG -6.95%) started off the new month on an auspicious note, climbing 3.9% Monday, and investors' enthusiasm is continuing Tuesday. The fuel cell stock was up by another 6.9% as of 10:44 a.m. ET.
While one analyst's bearish take on Plug Power's stock may have some traders looking to exit their positions, a greater number are clicking the buy button in response to the broader market's rise Tuesday.
So what
After the major indexes rose Monday, they have been extending their gains in early trading Tuesday, and Plug Power's stock has gone along for the ride. Shares of Plug Power sank 25% in September as investors moved away from more speculative growth stocks in response to rising interest rates and general fears of a recession. Evidently, those fears may be easing, and investors may again be coming to view growth stocks as viable investment choices.
Plug Power's rise Tuesday, however, is particularly noteworthy considering the attention it's receiving from Wall Street. P.J. Juvekar, an analyst at Citigroup, cut his price target on Plug Power to $28 from $36, but kept his buy rating on the stock. While Juvekar sees less room for shares of Plug Power to run, his new price target still implies an upside of more than 28% from Monday's closing price of $21.82.
Now what
With the markets off to a strong start on Tuesday morning -- the S&P 500 was up 2.4% as of 10:45 a.m. ET -- it's not all that surprising that Plug Power rose, even with the price target reduction coming from Citigroup. Potential Plug Power investors, though, should recognize that while the market's rally is an encouraging sign, there are extensive risks associated with an investment in this fuel cell stock. Investors should certainly do their due diligence before picking up shares.
