On Wednesday, Plug Power (PLUG -1.74%) will release its quarterly report, and investors have gone from euphoria to fear all within the last few months. Along with supply partner Ballard Power Systems (BLDP -3.29%) and fuel-cell-technology peer FuelCell Energy (FCEL -5.28%), Plug Power has seen substantial volatility in its share price as investors weigh the company's future prospects as well as its short-term moves to raise capital.

Plug Power has drawn a lot of attention in 2014, with order announcements pulling bullish investors into the stock while well-known research firms panning the company have sent shares plunging. Yet the real question facing Plug Power is whether its emphasis on hydrogen fuel cells will prove to be one of the major ways that businesses utilize alternative energy sources for power. With solar, wind, and microturbine technology vying to serve that alternative-energy role for customers, Plug Power has to convince potential users that its combination of convenience and cost beats out its competitors. Let's take an early look at what's been happening with Plug Power over the past quarter and what we're likely to see in its report.

Source: Plug Power

Stats on Plug Power

Analyst EPS Estimate


Year-Ago EPS


Revenue Estimate

$5.35 million

Change From Year-Ago Revenue


Earnings Beats in Past 4 Quarters


Source: Yahoo! Finance

What's next for Plug Power earnings?
Investors have had mixed views in recent months about Plug Power earnings, narrowing their full-year 2014 loss projections by almost 20% but cutting their 2015 profit expectations by more than half. The stock is up about 20% since early February, but that's a disappointment after shares had more than tripled at one point during the quarter.

Source: Plug Power

Plug Power's fourth-quarter earnings report inspired optimism among bullish investors, who pointed to a 36% jump in revenue as being just the tip of the iceberg. With recent orders from some of the largest companies in the transportation and retail industry, Plug Power said it had already booked $60 million in orders and was hoping to hit $150 million for the full year.

Some investors are concerned about Plug Power's valuation compared to some of its peers. The stock commands a premium to Ballard Power Systems and FuelCell Energy based on sales, and even though investors have high expectations for Plug Power's future sales growth, it'll be hard for the company to ramp up sales enough to sustain its share price even at current levels. Moreover, the need for Plug Power to raise capital has weighed on the stock, with a secondary stock offering at $5.50 per share in April pulling shares down from their highs above $10 earlier in the quarter.

But Plug Power is aggressively seeking growth opportunities on all fronts. In Asia, a deal with Hyundai Hysco could help Plug Power enter a market that's more receptive to hydrogen fuel-cell technology than the U.S. has been, with the potential of capitalizing on government subsidies for installing systems. Moreover, Plug Power's forklift technology could become a stepping stone toward other similar uses for corporate customers looking to improve their overall energy efficiency. Plug Power has also worked to reduce its dependence on Ballard Power Systems, buying fuel-cell stack maker ReliOn to allow Plug Power to end its exclusive agreement with Ballard at the end of this year.

Still, Plug Power has to fight competing sources of energy. Improvements in battery technology could make it more feasible for businesses to use other forms of alternative energy that are less consistently available, storing energy for use when conditions aren't as favorable for production methods like solar and wind. Moreover, with plentiful natural gas now available and distribution networks improving for its use, hydrogen fuel cells don't yet have the cost advantage that they might gain if fossil-fuel prices rise.

In the Plug Power earnings release, watch to see how the company addresses some of the concerns that short-sellers have raised, and where else it plans to get the order bookings it hopes to receive by year-end. Now is a critical time for Plug Power to go beyond its recent good news and show that it's building lasting momentum toward profitability next year.

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