Why Plug Power Analysts Are Bullish After Hydrogen Green Energy Company's Investor Day
The Plug Power Analysts: RBC Capital Markets analyst Joseph Spak maintained an Outperform rating on Plug Power and increased the price target from $35 to $40.
Morgan Stanley analyst Stephen Byrd maintained an Overweight rating and upped the price target from $40 to $43.
HC Wainwright analyst Amit Dayal maintained a Buy rating and $78 price target.
Plug Power A Proxy For 2H Opportunities, RBC Says: Plug Power reinforced the view it is poised to capitalize on green hydrogen's inflection with new announcements and partnerships, RBC analyst Spak said in a note.
The company guided 2022 revenue to a range of $825 million to $850 million, up from $750 million a year ago and the consensus estimate of $760 million, the analyst said. The 2025 revenue guidance of $3 billion is 30% above the consensus, he said.
The deal announced with Fortescue Future to manufacture electrolyzer technology in Australia is worth about $150 million and is one of the largest electrolyzer buys, Spak said.
The analyst sees potential for half of the deals to be booked in the second half of 2020, with the remainder in the first half of 2023.
RBC said Plug Power continues to be a proxy for second-half opportunities.
Plug Power Has Strong Catalyst Path Ahead, Morgan Stanley Says: As expected, Plug Power issued a very constructive update, including an increase to its 2022 outlook and stronger-than-expected guidance initiation, Morgan Stanley analyst Byrd said.
The $3 billion of revenue in 2025 includes about $1 billion from material handling, $500 million from new markets such as EV and stationary power and $1.5 billion from the green hydrogen market, which includes green hydrogen production and electrolyzers, the analyst said.
A strong catalyst path lies ahead, including enactment of the green hydrogen act within the next few months, the first stationary power announcement, the naming of its fifth pedestal customer, additional partnerships/JVs and the potential for continued vertical integration through M&A, Byrd said.
Why Plug Power Will Likely Begin Generating Operating Profit In 2023:
Plug Power's revenues are likely to rise from $481.4 million in 2021 to $16.7 billion in 2030, at a nine-year CAGR of 48.3%, H.C. Wainwright analyst Dayal said.
"We believe that the company should be able to grow its gross margins from negative levels today to 23.1% on 2022 and subsequently reach 36.2% in 2030 as revenues rise," the analyst said.
Plug Power will likely begin generating operating profits in 2023, he said.
PLUG Price Action: Plug Power shares lost 1.79% Friday, closing at $31.24.
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