Quealy initiated coverage of Plug Power’s stock with a Buy rating and price target of $5.00, which implies an upside of nearly 100% from where the stock is currently trading. The analyst highlighted three factors to support his bullish stance:
- A Growth Story – We feel that it’s an appropriate time for aggressive growth (and risk-forward) investors to gain exposure to this motive power pioneer. While characteristic share price volatility likely remains, the macro has finally caught up to the company’s alternative energy mission, in our view […] Despite the accounting treatment complexities, product gross margins look geared to grow meaningfully into 2019 toward motive power industry norms initially (Hyster-Yale ~17-18%) as volumes, product design/supply chain and service fleet densities should work to benefit the financial position.
- Technology provides solid mid-term visibility – By wrapping hardware, software and maintenance (along with third-party financing in some areas), the company has been very successful in driving the commercialization of its fuel cell technology (Proton Exchange Membrane-based).
- Strong leadership – Since we last covered PLUG, CEO Andy Marsh (started in 2008) has done a very solid job, first by salvaging the business (negative EV in 2008) and then powering the strategy toward lift truck/material handling market disruption and now looking toward other ancillary markets given the maturity of the macro (e.g., trials underway with FedEx), all while keeping a focus on improving platform profitability.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst John Quealy has a yearly average return of 8.9% and a 58% success rate. Quealy is ranked #430 out of 4738 analysts.
When it comes to Wall Street’s bet, the odds are on this hydrogen fuel-cell maker, with TipRanks analytics showcasing PLUG as a Strong Buy. Out of 6 analysts polled in the past 6 months, five are bullish on Plug Power stock while is bearish. With a return potential of nearly 19%, the stock’s consensus target price stands at $2.96.