Plug Power: The Long and Short of the Trade

NEW YORK (TheStreet) -- The share price of Plug Power  (PLUG) is up an eye-popping 1,060% since Nov. 26. After the market close of Wednesday, the maker of fuel-cells packs for forklifts announced its purchase of ReliOn, a developer of hydrogen fuel cell stack, in an all-stock deal worth $4 million. Plug shares traded late Friday at $7.06.

What began with Plug's announcement in early December of its expectation to finally make a profit after 14 years of product development, aborted market directions and serial share dilutions, has morphed into a speculative fight between relentless momentum traders and a growing chorus of vocal shorts who anticipate an imminent bubble run-in with a pin.

At nearly 30-times sales, the stock trades at a price already discounting not only a full-year fiscal 2014 revenue guidance of $70 million but also a potential revenue-double for fiscal 2015, stemming, in part, from Wal-Mart's (WMT) anticipated order stream to outfit more of the mega-retailer's distribution centers.

In essence, investors who take a stake in Plug today are pricing in a two- or three-year flawless performance from Plug CEO Andy Marsh whose track record of forecasting anything remotely accurate has yet to be witnessed since as far back as 2010, as Andy Left's Citron Research aggressively asserts.

As a result of three years of the alleged Marsh double-talk, some say the man is downright disingenuous, while others say that Marsh's string of guidance misses comes from a combination of unexpected technical defects in Plug's past products and a childlike streak of optimism along the way.

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