Plug Power Shares Drop After Joint Venture News

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By Trey Thoelcke Published
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Fuel cell maker Plug Power Inc. (NASDAQ: PLUG) announced Monday that it has signed a non-binding agreement with Hyundai Hysco, a steel supplier to Hyundai Motors, to form a joint venture partnership. Its aim is to develop and market hydrogen fuel cells throughout Asia using Hysco’s advanced stack and plate technology.

Plug Power CEO Andy Marsh said:

This highly anticipated joint venture with Hysco will enable Plug Power to broaden its reach into the Asian market, putting us well on our way toward global market expansion. The positive impact on our bottom line from fuel cell sales in the region in 2015 and beyond will play a significant role in our achievement of profitability.

The deadline for the companies to finalize the details of the joint venture is July 31, 2014.

Shares surged more than 10% to $8.23 in early trading. But the stock surrendered those gains in the wake of the morning business update from the CEO that failed to inspire investors. To date, Plug Power has closed nine GenKey deals, totaling almost $80 million in bookings. Plug Power posted 2013 revenues of $26.6 million, and the Thomson Reuters forecast called for sales of $65.0 million in 2014 and $116.3 million in 2015.

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Plug Power and competitor FuelCell Energy Inc. (NASDAQ: FCEL) posted astonishing share price gains so far this year that had many wondering what the fair value of the fuel cell makers was. Plug power is up more than 214% year to date, while FuelCell is around 70% higher after retreating from a 52-week high in March.

Plug Power shares were down around 5% in late morning trading, at $6.95 in a 52-week range of $0.15 to $11.72. The consensus price target (of just two analysts) is $7.75.

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About the Author Trey Thoelcke →

Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.

Beyond 24/7 Wall St., Trey has created and edited financial content for Benzinga and AOL's BloggingStocks, contributing additional hundreds of articles to the investment community. He previously oversaw the 24/7 Climate Insights site, managing editorial operations and content strategy, and currently oversees and creates content for My Investing News.

Trey's editorial expertise extends across multiple publishing environments. He served as production editor at Dearborn Financial Publishing and development editor at Kaplan, where he helped shape financial education materials. Earlier in his career, he worked as a writer-producer at SVE. His freelance editing portfolio includes work for prestigious clients such as Sage Publications, Rand McNally, the Institute for Supply Management, the American Library Association, Eggplant Literary Productions, and Spiegel.

Outside of financial journalism, Trey writes fiction and has been an active member of the writing community for years, overseeing a long-running critique group and moderating workshop sessions at regional conventions. He lives with his family in an old house in the Midwest.

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