4 Reasons Plug Power Is a "Sell"
Vikram Bagri of Citigroup recently downgraded Plug Power stock from "neutral" to "sell." He believes the company's limited corporate liquidity, dilution through ongoing ATM issuances, elusive profitability, and increasing competition make it a poor investment.
1. Limited Corporate Liquidity
Plug Power issued a going concern notice in 2023, indicating a risk of running out of cash. Although the company has raised new funds, those funds diluted shareholders through a share-issuance agreement.
2. Dilution
Bagri believes Plug Power will continue to dilute shareholders as it needs more cash. The company has not consistently generated profits, and its expansion plans have drained its cash flow.
3. Elusive Profitability
Over the past ten years, Plug Power has failed to produce positive earnings. Recent price increases across its offerings may not be sustainable given the growing competition and technological advantages of other incumbents.
4. Competition
Plug Power's price increases may negatively impact sales or fail to materialize due to competition.