Plug Power Stock Heads For Worst Week In 4 Months, But Retail's Charged Up As DoE Closes $1.7B Loan

synopsis

Shares of hydrogen fuel cell maker Plug Power Inc. slid over 7% on Friday morning, marking a three-week low and heading for their worst week since early September. 

Despite this decline, retail sentiment remained optimistic, fueled by the announcement of a $1.66 billion loan guarantee from the U.S. Department of Energy's (DoE) Loan Programs Office.

The loan guarantee will finance the construction of up to six projects across the U.S. that aim to produce and liquefy zero or low-carbon hydrogen at scale. 

Plug's hydrogen generation network currently includes plants in Georgia, Tennessee, Louisiana, and South Carolina with a liquid hydrogen production capacity of around 45 tons per day.

In prepared remarks, plug Power CEO Andy Marsh said, "In addition to reducing carbon emissions and enhancing the resilience of the U.S. energy grid, we believe the hydrogen economy aligns closely with national security interests."

PLUG sentiment and message volume Jan 17 as of 11 am ET | source: Stocktwits

Sentiment on Stocktwits was 'extremely bullish,' with message volume spiking more than 130% in the previous session after Bloomberg reported the company was nearing the loan's closure. 

Some retail investors viewed the drop as an opportunity to buy more shares, while others saw the development as a blow to those shorting the stock. 

According to Koyfin data, Plug's short interest has risen from 21.4% to 23.3% over the past month.

There are also concerns about Plug's financial stability. The company has missed profit estimates in the past four quarters and faces challenges in a competitive and costly clean hydrogen market. 

In 2023, Plug issued a "going concern" notice but resolved that issue last year. Analysts reportedly expect the company to lose over $500 million this year.

With President-elect Donald Trump's inauguration next week, concerns regarding the future of clean energy and EV-linked stocks have intensified. 

However, in a Barron's interview, Marsh pointed out that the Trump administration did not claw back any similar DoE contracts during his first term. 

He also highlighted the hydrogen industry's appeal across political lines, particularly in red districts, where job creation and oil and gas sector support could help secure continued government backing.

Plug Power stock has performed reasonably well recently, gaining 8.7% in the last 12 months and 22% in the previous three months. 

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