NEW YORK (TheStreet) -- Plug Power (PLUG) shares are up 3.33% to $2.67 in morning trading on Tuesday after the hydrogen fuel cell manufacturer announced that it has gained an undisclosed big box retailer as a client, reaching an agreement for its fuel cell system to power the material handling fleet at the company's new distribution center in Ohio.
Latham, NY-based Plug Power said that its new client also has over 100 distribution centers across the country and that it is currently in negotiations for future deployments of its GenKey hydrogen and fuel cell system across its network.
"Plug Power has done a tremendous job at deploying our GenKey solution with a broad range of customers who are critical to our growth," said CEO Andy Marsh. "This new big box retailer falls in line with customers like Walmart, Kroger and Ace Hardware. And, we intend to have a similar relationship in helping this customer realize the business improvements provided by a Plug Power solution."
TheStreet Ratings team rates PLUG POWER INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate PLUG POWER INC (PLUG) a SELL. This is driven by several weaknesses, 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 weak operating cash flow and generally disappointing historical performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Net operating cash flow has significantly decreased to -$13.65 million or 53.52% 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.
- PLUG's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 31.16%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- 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 -$0.65 versus -$0.79 in the prior year. This year, the market expects an improvement in earnings (-$0.22 versus -$0.65).
- PLUG's very impressive revenue growth greatly exceeded the industry average of 12.5%. Since the same quarter one year prior, revenues leaped by 68.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- You can view the full analysis from the report here: PLUG Ratings Report