2020 has been a rollercoaster ride for many stocks but there have been certain exceptions and Plug Power Inc (NASDAQ:PLUG) is one of those. The hydrogen fuel company saw its stock soar in 2019 and in 2020; it has recorded gains of 500% so far. In this sort of situation, it is worthwhile to ponder whether Plug Power is still worth buying or not.
Turnaround
At this point, only two and a half months are still to go in the year, and hence, many investors might be thinking about the clear winner among fuel stocks. At this point, Plug Power is considerably ahead of second-placed Bloom Energy, which has seen its stock soar by around 200%.
Investors are possibly wondering if the company has finally managed to turn things around and there is an argument to be made in that regard. Plug Power managed to generate a profit for the first time in two decades and the cash flow had also been positive.
That being said, canny investors would have noticed that if the cash flow is seen on the trailing 12-month basis, then the picture is quite different. Plug Power had a record negative cash flow by the metric.
Future Plans
Experts believe that the bullish sentiment with regards to the Plug Power stock could be actually rooted in the company’s targets for 2024.
Although the coronavirus pandemic came as a setback for the company, Plug Power reiterated that its target of $300 million gross billings in 2024 remains intact. It added that the company is on track to hit the targets.
Additional Factors
However, that is not the only factor that drove the rally in the Plug Power stock this year. Analysts had also made bullish noises about the stock and many of them upgraded the stock as well.
On top of that, there is further excitement about Plug Power since the company is ready to get involved in the commercial hydrogen fuel space.
Conclusion
The current bullish trend in the stock has some reasons, but at the same time, it cannot be denied that Plug Power still needs to work on its bottom line.
Investors perhaps hope that the company is going to swing into profitability in the future. However, it seems that it has been priced in already. It is a bet on the future at this point and may appeal to investors who are hunting for growth stocks.
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