Plug Energy (NASDAQ: PLUG) inventory surged by as a lot as 15.3% at its highest level in buying and selling this week earlier than reversing course on Thursday. And on Friday morning, shares of the hydrogen and gasoline cell maker crashed by greater than 8% and had been buying and selling 3.5% decrease for the week by way of 11 a.m. ET, in line with information offered by S&P Global Market Intelligence.
Plug Energy introduced a brand new technique this week that might usher in some money, however a recent growth in one other a part of the clear vitality business dampened investor sentiment and despatched the hydrogen stock tumbling once more.
Why Plug Energy inventory rose beforehand
This week, Plug Energy introduced it was initiating a brand new gear leasing platform that might assist it increase $150 million within the mid-to-near time period. To start out, it signed three sale and leaseback transactions value $44 million with GTL Leasing, a lessor of hydrogen storage and transport gear. Personal fairness agency Antin Infrastructure Companions owns a majority stake in GTL.
Beneath such transactions, Plug Energy can obtain lump sum funds for gear akin to trailers and storage tanks whereas retaining the fitting to make use of them, giving it speedy entry to funds it might use to cowl its day-to-day operational bills.
Plug Energy inventory might stay unstable
Plug Energy is going through an ongoing money crunch amid dwindling sales and mounting losses, and even issued a going concern warning final 12 months. Its new leasing platform might permit it to lift some money whereas it tries to safe greater funding, akin to a mortgage from the Division of Vitality. Plug Energy has a conditional mortgage assure of as much as $1.66 billion, and says it’s working carefully with the division to finalize the mortgage.
This week, Plug Energy additionally secured an order for 25 megawatts of electrolyzers from Castellon Inexperienced Hydrogen, a three way partnership between vitality big BP and Spain-based utility operator Iberdrola. Whereas this order indicators a rising curiosity in inexperienced hydrogen, different clear vitality sources are getting much more consideration.
On Friday, utility big Constellation Vitality introduced plans to restart a shuttered nuclear reactor in Pennsylvania after signing an enormous contract to supply carbon-free electrical energy to tech big Microsoft‘s information facilities. The deal may very well be a harbinger of extra alternatives to return for nuclear energy, which is cheaper to supply, making it even tougher for corporations like Plug Energy to make a compelling case for alternate options akin to inexperienced hydrogen.
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Why Plug Power Stock Plunged on Friday After an Early Week Rally was initially printed by The Motley Idiot
