Plug Power Inc (NASDAQ:PLUG) Logs Fourth Red Session in a Row
Plug Power Inc (NASDAQ:PLUG) slipped yesterday and lost 2.63% of its value. It registered its fourth red session in a row and finished the day at $4.08 per share. Not really the performance the shareholders are hoping for and when you take a look at the longer term behavior, you’ll see that things look even more disappointing. The logical question is: “Why?“.
Part of the reason could be the lack of any significant developments around the company. PLUG‘s latest press release came out nearly a month ago and it contained a summary of the results recorded at the end of the first quarter. Here they are:
- cash: $63 million
- current assets: $84 million
- current liabilities: $11.7 million
- revenue: $5.5 million
- net loss: $75 million
When you compare the figures above with the ones found in the company’s previous filings, you’ll see that they have managed to increase their cash position and you’ll also note that some of the liabilities have been satisfied. Unfortunately, there’s been a 13% drop in revenues year over year and the negative bottom line is still there.
Apparently, a Seeking Alpha contributor who goes by the name of Jason Russ isn’t particularly happy about this fact. He published an article on June 5 according to which PLUG‘s real value should be hovering below $2 per share.
This has probably contributed to the slide the ticker is experiencing at the moment, but we can’t imagine that the article’s effects will last forever. Unfortunately, a few other things could do some long-term damage.
In the latest press release, PLUG‘s CEO, Andrew Marsh, said that he and his team are focused on “building a large profitable company“. Plug Power is by no means small, but right now, the “profitable” bit seems to be out of reach. This, in turn, has led to another problem – dilution.
If you go through the filings, you’ll see that the number of issued and outstanding shares has grown from 102 million at the beginning of November 2013 to 167 million on May 7, 2014. PLUG recently announced that one of the discussion points during the upcoming annual stockholder meeting will be a potential raise of the number of authorized shares which could suggest that the O/S count might grow further in the future. Hopefully, the deals and joint ventures that are currently in the works will help the company cut down on the stock issuance.
Unfortunately, guarantees about that can not be given at the moment which is why doing your own careful research and considering the risks is absolutely essential.
