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What to Do With Volatile Plug Power Shares

PLUG Shares Outstanding Chart

The chart above illustrates a rather curious pattern. CEO Andrew Marsh may have missed his calling. He appears more apt at selling stock than forklift fuelcells. I don't recall the last time (if ever) I've seen a company with a $1 billion market capitalization inflate its share count by a factor of 10.

Well. actually, Plug Power's billion-dollar market cap slipped away when the shares fell below $7. It's unlikely that the stock will trade above $7 tomorrow.

The upside is it's equally unlikely that the stock will fall below $1 anytime soon. The company should have at least a dollar per share in cash alone. Maybe that's the point -- have a sufficient buffer to avoid violating the Nasdaq's minimum share price requirement.

But based on Marsh's comments during an earnings conference call in March, the company is executing on its plans to break even on an Ebitda (earnings before interest, taxes, depreciation and amortization) basis this year.

Furthermore, shouldn't Plug Power's increased order flow take care of cash-flow issues? And if capital is needed for acquisitions and or expansion, why not issue bonds or borrow the money or both?

Even Apple (AAPL) is borrowing money just to buy shares because loan rates are so cheap. Obviously Apple can borrow at more favorable rates than Plug Power, but the relative concept is the same. Why would anyone with a choice issue a secondary offering with interest rates so low? Maybe Plug Power doesn't have a choice.

PLUG Free Cash Flow Per Share (Quarterly) Chart

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