Trade-Ideas: Plug Power (PLUG) Is Today's

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Plug Power ( PLUG) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Plug Power as such a stock due to the following factors:

  • PLUG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $18.4 million.
  • PLUG has traded 3.8 million shares today.
  • PLUG is down 3.5% today.
  • PLUG was up 5.7% yesterday.

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More details on PLUG:

Plug Power Inc., an alternative energy technology provider, is engaged in the design, development, manufacture, and commercialization of fuel cell systems for the industrial off-road markets worldwide. Currently there are 2 analysts that rate Plug Power a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Plug Power has been 7.9 million shares per day over the past 30 days. Plug has a market cap of $623.3 million and is part of the technology sector and electronics industry. The stock has a beta of -0.08 and a short float of 21.3% with 6.82 days to cover. Shares are up 125.8% year-to-date as of the close of trading on Wednesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Plug Power as a sell. Among the areas we feel are negative, one of the most important has been weak operating cash flow.

Highlights from the ratings report include:
  • Net operating cash flow has significantly decreased to -$11.09 million or 58.18% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength 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's debt-to-equity ratio is very low at 0.02 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 7.84, which clearly demonstrates the ability to cover short-term cash needs.
  • This stock has increased by 500.00% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the future course of this stock, we feel that the risks involved in investing in PLUG do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
  • PLUG POWER INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, PLUG POWER INC continued to lose money by earning -$0.79 versus -$0.94 in the prior year. This year, the market expects an improvement in earnings (-$0.19 versus -$0.79).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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