Plug Power (PLUG) Drops Today After Previous Boost (Update 1)

Updated 4:56 p.m. to include closing price, change and volume.

 (TheStreet) -- Plug Power  (PLUG) closed out the trading day Thursday with a 27.03% to $3.32 after it soared more than 40% earlier in the week. The stock had a volume of 64,178,419 compared to its average volume of 12,136,400.

The stock hit a low of $3.31 for the day and a high of just $4 after the stock closed at $4.55 on Wednesday. Plug Power has a one-year high of $4.90 and a one-year low of $0.12.

Plug Power announced on Tuesday that it would start to develop hydrogen fuel-cell range extenders for 20 FedEx (FDX) delivery trucks, which should allow the vehicles to cover twice as much ground. The U.S. Department of Energy will fund the $3 million project, which includes Plug Power, FedEx Express and Smith Electric Vehicles as partners. Lithium-ion batteries and Plug Power's own 10-kilowatt hydrogen fuel cells will power the new hybrid trucks. Plug Power's GenDrive Series 1000 products provide the basis for the fuel cell solution.

TheStreet Ratings team rates PLUG POWER INC as a Sell with a ratings score of D-. The team has this to say about its recommendation:

"We rate PLUG POWER INC (PLUG) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income and disappointing return on equity."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Electrical Equipment industry. The net income has significantly decreased by 54.0% when compared to the same quarter one year ago, falling from -$10.33 million to -$15.90 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Electrical Equipment industry and the overall market, PLUG POWER INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • PLUG, with its decline in revenue, underperformed when compared the industry average of 10.1%. Since the same quarter one year prior, revenues slightly dropped by 3.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • PLUG's debt-to-equity ratio of 0.85 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.21 is sturdy.
  • Net operating cash flow has slightly increased to -$7.01 million or 1.82% when compared to the same quarter last year. Despite an increase in cash flow, PLUG POWER INC's cash flow growth rate is still lower than the industry average growth rate of 19.53%.
  • You can view the full analysis from the report here: PLUG Ratings Report