Why Plug Power Stock Plunged on Friday After an Early Week Rally

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Why Plug Power Stock Plunged on Friday After an Early Week Rally

Plug Power (NASDAQ: PLUG) stock surged by as much as 15.3% at its highest point in trading this week before reversing course on Thursday. And on Friday morning, shares of the hydrogen and fuel cell maker crashed by more than 8% and were trading 3.5% lower for the week through 11 a.m. ET, according to data provided by

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Plug Power announced a new strategy this week that could bring in some cash, but a fresh development in another part of the clean energy industry dampened investor sentiment and sent the

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tumbling again.

Why Plug Power stock rose previously

This week, Plug Power announced it was initiating a new equipment leasing platform that could help it raise $150 million in the mid-to-near term. To start, it signed three ***** and leaseback transactions worth $44 million with GTL Leasing, a lessor of hydrogen storage and transport equipment. Private equity firm Antin Infrastructure Partners owns a majority stake in GTL.

Under such transactions, Plug Power can receive lump sum payments for equipment such as trailers and storage tanks while retaining the right to use them, giving it rapid access to funds it can use to cover its day-to-day operational expenses.

Plug Power stock could remain volatile

Plug Power is facing an ongoing cash crunch

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, and even issued a going concern warning last year. Its new leasing platform could allow it to raise some cash while it tries to secure ******* funding, such as a loan from the Department of Energy. Plug Power has a conditional loan guarantee of up to $1.66 billion, and says it is working closely with the department to finalize the loan.

This week, Plug Power also secured an order for 25 megawatts of electrolyzers from Castellon Green Hydrogen, a ****** venture between energy giant BP and Spain-based utility operator Iberdrola. While this order signals a growing interest in green hydrogen, other clean energy sources are getting even more attention.

On Friday, utility giant Constellation Energy announced plans to restart a shuttered nuclear reactor in Pennsylvania after signing a big contract to provide carbon-free electricity to tech giant

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’s data centers. The deal could be a harbinger of more opportunities to come for nuclear power, which is cheaper to produce, making it even ******* for companies like Plug Power to make a compelling case for alternatives such as green hydrogen.

Should you invest $1,000 in Plug Power right now?

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for investors to buy now… and Plug Power wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

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*Stock Advisor returns as of September 16, 2024

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has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends BP, Constellation Energy, and

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. The Motley Fool recommends the following options: long January 2026 $395 calls on

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and short January 2026 $405 calls on

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. The Motley Fool has a

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was originally published by The Motley Fool

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