Plug Power – A lot of self-commending, little development


April 8, 2023

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Plug Power – A lot of self-commending, little development

The Analyst Day on January 25, 2023 unfortunately did not bring many new insights. The company representatives promised a shiny future and see the company as a leader in hydrogen. Some forecasts and self-imposed targets could have done with more realism, is my subjective feeling. Unfortunately, there are always setbacks that negate any associated forecasts time and again.

For example, Plug has scrapped the plan to build a joint gigafactory (50:50) with Australian company Fortescue Future Industries (FFI) of billionaire Andrew Forrest for electrolyzers in Australia. Both companies claim that it has the better electrolysis technology. FFI relies on its own PEM and alkaline electrolysis and plans to use its in-house electrolysis for large-scale projects. The joint project in Queensland was ended, though. There, an annual capacity of 2 to 3 GW was to be installed.

FFI wants to continue to give Plug orders for smaller electrolyzer projects, however. Regardless that I didn’t even know FFI possesses its own electrolysis technology as well as production facilities, this abrupt termination of the joint venture certainly raises questions, since Plug had already announced commensurate cooperations. What does this mean then for Plug’s already made forecasts for its future?

Stacks and electrolyzers go into production

On January 12, 2023, US Senator Chuck Schumer (Democrat) ceremoniously cut the ribbon at Plug Power’s Vista Technology Park Campus near Albany, New York. Plug has invested 125 million USD in this. There, the production site can be significantly expanded. A similar investment was made the year before by Plug in Rochester, NY. CEO Andy Marsh expressed that each production facility is unique. In Rochester, fuel cells for forklift trucks will be manufactured. The Vista Tech Campus will already be utilized to capacity this year due to very high demand, it was stated.

Just 220.7 million USD turnover (48 million USD less that expected) brought the fourth quarter of 2022. In the end, a minus of 1.25 USD per share (GAAP). Now, they’re aiming at 1.4 billion USD turnover for this year and 2.1 billion USD in 2024. If you read the 10-K (financial report to SEC), many risk factors are pointed out, which Plug is addressing (10-K Annual Report can be downloaded from Plug’s website).

FC system from Plug in forklift


That Amazon reduced its order of GenDrive units for forklifts in 2022 by nearly 55 percent from 2021 is noteworthy. Especially interesting is a look at the cash on hand, as the intense growth is being financed from it (production facilities for FC stacks, electrolyzer and hydrogen as well as a variety of acquisitions). In 2022, the cash and cash equivalents lowered to 2.15 billion USD, where 858 million USD of it is restricted cash, so serves as collateral for sale-leaseback projects. In 2023, 1 billion USD is to be invested. Will the next capital raising via new issuance of shares perhaps come out of this?

Analysts now see the share on average at 22 USD (27 USD previously).


Each investor must always be aware of their own risk when investing in shares and should consider a sensible risk diversification. The FC companies and shares mentioned here are small and mid cap, i.e. they are not standard stocks and their volatility is also much higher. This report is not meant to be viewed as purchase recommendations, and the author holds no liability for your actions. All information is based on publicly available sources and, as far as assessment is concerned, represents exclusively the personal opinion of the author, who focuses on medium- and long-term valuation and not on short-term profit. The author may be in possession of the shares presented here.

Written by author Sven Jösting, March 5th, 2023


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