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Currently, Plug Power ($PLUG) is a hot stock on a variety of platforms, after Citron Research – one of the leading hedge funds in the United States – nicknamed the company “anti-Tesla”. The reason for this was CEO Andy Marsh’s trading by selling 95% of his position at an average price below $7 dollars. However, it is not the first time that Citron Research has given a company this nickname.
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Why even look to short $TSLA when $PLUG is twice as expensive with a never profitable business.
On June 9, 2020, Nikola Corporation ($NKLA) meets the same fate and is called the anti-Tesla. Nikola saw a massive rise from $36 dollar high on June 5, 2020, peaking near $80 dollar on June 9, 2020. The stock hit its all-time peak when Citron predicted that the ‘anti-Tesla’ would drop back to $40 dollars per share. Arguments for this nickname included the sale of Milton for $10 the week before, the lack of IP and the exaggerated promos from the PR department. Citron then compared the situation to when Model S was scaled and Model X was produced, and concluded in that comparison that Nikola was far short. While not everyone always agrees with Citron, it seemed that this time the vast majority are in agreement with the opinion.
Citron Research
The stock saw a bullish flag after which it fell further over the weeks. July 7, 2020, the stock was exactly at $40.23 dollar, an extremely good prediction from Citron. Exactly one month later on July 9, 2020, the stock was at $56.75, but the stock was unable to fight back up. Today, August 21, 2020, the counter is at approximately $39 per share. And despite the appointment of new CEO Mark Russell in June 2020, no further progress has been made on the stock.
Whether this is a sign that Citron will also be proved right this time can’t be said with certainty, but it is striking. Where the vast majority agreed with the news about Nikola last time, the opinion now seems strongly divided. First, the public seems to have more confidence in Plug Power’s hydrogen technology. Another reason could be the accusation of fraud against GSX Techedu ($GSX), a technology-driven education company from China. Andrew Left stated in an email: “GSX is a complete fraud and a complete scam. They harm legitimate Chinese companies and should be investigated immediately.” There have been strong allegations in the report referenced further in the mail. But this strong language now has a downside.
Andrew Left and Citron accused of fraud
The question that may remain with some of the public is whether enough public information is available to suggest concerns about the GSX stock. It wouldn’t be the first time Citron has written an article or report with destructive words that could be questioned. Citron and Andrew Left are currently under serious investigation after Andrew Left has been indicted and convicted of proclaiming legal untruths. There’s even a petition signed by nearly 15,500 people (August 21, 2020) to have Andrew Left and Citron Research investigated by the FINRA and SEC Enforcements.
Perhaps a plaster on the wound for the shareholders and Plug Power itself, which as far as we know, are not sending out fraud-sensitive signals. Let’s keep that topic with Steve Bannon for now.
About Plug Power
Plug Power Inc. is a provider of alternative energy technology focused on the design, development, commercialization and manufacture of hydrogen fuel cell systems used for the industrial off-road market and the stationary power market. The Company’s product line includes GenKey, GenDrive, GenFuel, GenCare and ReliOn.
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