What occurred
Shares of Plug Energy ( PLUG -4.48% ) misplaced floor on Wednesday. The hydrogen fuel-cell firm’s inventory ended the day down 4.5% amid bearish pressures impacting the broader market. The S&P 500 ended the day down 1.8%, and the Nasdaq Composite index closed out the session down 2.6%.
The market’s sell-off right now appears to have primarily been pushed by mounting issues concerning the potential impacts of Russia’s invasion of Ukraine. With macroeconomic headwinds and rising geopolitical threat elements, progress shares have typically had a tough go of issues early in 2022, and Plug Energy’s share worth has slumped roughly 30% 12 months so far.
So what
Russian President Vladimir Putin ordered troops into the jap Ukrainian territories of Luhansk and Donetsk on Tuesday, and it stays unclear how the state of affairs will progress. Plug Energy’s inventory had really been up as a lot as 3.4% earlier in Wednesday’s buying and selling, however traders turned more and more bearish because the afternoon progressed.
It seems just like the state of affairs in Ukraine may proceed to trigger markets to be uneven within the close to time period.
Picture supply: Plug Energy.
Now what
2022 is shaping as much as be an vital 12 months for the electric-vehicle-charging firm, and it is aiming to hit electrolyzer shipments of 155 megawatts within the interval. The corporate supplied a enterprise replace on Jan. 19, and administration laid out a goal for gross sales between $900 million and $925 million this 12 months. Wanting additional out, it expects to report $3 billion in gross sales in 2025 and report a 30% gross margin and a 17% working margin.
After right now’s sell-off, Plug Energy now has a market capitalization of roughly $11.4 billion and is valued at roughly 12.6 instances this-year’s anticipated gross sales. The inventory is buying and selling down roughly 63% from its 52-week excessive and could possibly be poised for a rebound if the corporate hits its goal his 12 months.
Buyers ought to transfer ahead with the understanding that the corporate’s growth-dependent valuation units the stage for turbulent buying and selling amid unstable market circumstances.
This text represents the opinion of the author, who could disagree with the “official” suggestion place of a Motley Idiot premium advisory service. We’re motley! Questioning an investing thesis – even one in every of our personal – helps us all assume critically about investing and make selections that assist us turn out to be smarter, happier, and richer.
