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What to Do With Volatile Plug Power Shares

NEW YORK (TheStreet) -- Shares of fuel-cell-powered forklift maker Plug Power (PLUG - Get Report) have pulverized shareholders since I wrote my first warning that the stock was becoming overheated.

The stock's ride from less than 20 cents in 2013 to over $11 in March was a remarkable run, but between a bearish report from Citron Research and my above-mentioned article on March 11, reality returned to the market.

Momentum day traders realized the music stopped without enough chairs for everyone. Unsurprisingly, when the tide turned, the mob was as emotional on the way down as it was going up.

PLUG Chart

When the stock tumbled, I advised investors to take a step back and try to remove emotion from their investing decisions. I can't stress this enough -- if you're going to be successful in the long run, you need to have an plan to sell that includes TWO exits. One is your profit target and one is your stop loss.

Meanwhile, Plug Power's secondary offering last month should help stabilize the stock. The offering of 22.6 million shares at $5.50 each (before overallotment to underwriters) raised $124 million, giving the company a war chest to work with, but I wonder if Plug Power really needs the money or if management sold more shares out of habit.

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