This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Don't Let Citron Research Sour You on Plug Power

NEW YORK (TheStreet) -- Plug Power (PLUG - Get Report) is gaining today, and for good reason.

Citron Research, a short seller that has made a name for itself uncovering Chinese stock frauds, set its sights directly on Plug Power earlier this week, creating an avalanche of selling that culminated in the Latham, New York-based maker of alternative energy technologies losing 40% of its market capitalization in a single session.

That's called moving the market.

On Tuesday, I warned investors not to get caught up in the emotion of Plug Power or similar alternative energy companies, Fuelcell Energy (FCEL) and Ballard Power Systems (BLDP). But speculators grabbed those stocks anyway.

Plug Power's rapid decline was prompted by a negative report and televised comments from Andrew Left, Citron Research's founder, and a man not unaccustomed to controversy. Left has a history of becoming the news as much as the stock in question.

According to the National Futures Association, Left was sanctioned for "false and misleading statements to cheat, defraud or deceive a customer in violation of NFA compliance rules 2-2(a) and 2-29(a)(1). Left's conduct was inconsistent with just and equitable principles of trade."

As a consequence, the NFA panel "barred Left from association with and from acting as a principal of any NFA member for three years; ordered him to take an ethics training course; and placed restrictions on his activities for two years which prevent him from supervising any AP and require him to tape record and log all conversations with current and potential customers."

You may not have been aware of that information when Left appeared on Comcast's (CMCSA) CNBC on Tuesday to talk about Plug Power. The network apparently decided it was reasonable to allow Left to state his case without another guest challenging his claims. the result was a turkey shoot.

PLUG Revenue (TTM) Chart

It's not unusual for the market to quickly brush off a negative Citron Research report and continue higher. I know this from firsthand experience. After shorting falling stocks in the immediate aftermath of negative reports and watching my short reverse back higher too many times, I've learned to remain skeptical about Left's research.

1 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
PLUG $2.01 0.00%
AAPL $94.30 -0.92%
FB $118.08 0.55%
GOOG $695.81 0.50%
TSLA $234.65 1.00%


Chart of I:DJI
DOW 17,651.26 -99.65 -0.56%
S&P 500 2,051.12 -12.25 -0.59%
NASDAQ 4,725.6390 -37.5850 -0.79%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs