Plug Power Inc. (PLUG): A Bull Case Theory

We came across a bullish thesis on Plug Power Inc. (PLUG) on Tiny Stock Ninja’s Substack. In this article, we will summarize the bulls’ thesis on PLUG. Plug Power Inc. (PLUG)’s share was trading at $0.78 as of 23^rd May.

Plug Power Inc. (PLUG) reported Q1 2025 results showing moderate revenue growth to $133.7 million, an 11% increase year-over-year, driven by electrolyzer deliveries and hydrogen production. Despite significant improvement in gross margin losses—from -132% to -55%—the company remained unprofitable, with high operating expenses and an EPS miss fueling investor skepticism and a nearly 10% stock decline.

Operationally, Plug Power expanded its hydrogen production capacity with a new Louisiana plant and highlighted a $21 billion European electrolyzer project pipeline, positioning itself strongly in the green hydrogen economy amid growing demand and favorable EU policies. Financially, the company bolstered liquidity through a $280 million equity raise, a $525 million financing facility, and a $1.66 billion DOE loan guarantee, ending Q1 with nearly $300 million in unrestricted cash, yet persistent cash burn and capital expenditures pose sustainability questions.

Management aims for gross margin breakeven by the end of 2025 and no additional equity raises this year, signaling confidence but acknowledging risks from U.S. policy uncertainty, supply chain challenges, and concentrated customer exposure. Analysts maintain a “Hold” rating with a $2.10 price target, reflecting long-term potential tempered by near-term operational and regulatory hurdles. While the stock’s recent decline reflects investor caution, Plug Power’s cost reduction initiatives and strategic focus on Europe provide a compelling, though risky, investment case for those bullish on hydrogen’s future, contingent on successful execution of key milestones such as the Texas plant commissioning and European project final investment decisions.

Plug Power Inc. (PLUG) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 13 hedge fund portfolios held PLUG at the end of the first quarter which was 24 in the previous quarter. While we acknowledge the risk and potential of PLUG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than PLUG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.