H.C. Wainwright analyst Amit Dayal remains bullish on Plug Power (NASDAQ:PLUG) stock after the company received a conditional commitment of up to $1.66 billion loan guarantee from the Department of Energy (DOE). Dayal has the highest price target among all analysts covering PLUG stock on TipRanks. His price target of $18 implies a colossal 424.8% upside potential from current levels.
Plug Power is one of the largest green hydrogen companies in North America and Europe. Its hydrogen fuel cell technology is used in electric mobility and stationary power markets.
Dayal Upbeat on Plug Power’s Gains from the Funding
Dayal is encouraged that the DOE’s funding would be used by Plug Power to finance the build-out and deployment of up to six green hydrogen production facilities. Although the funding is based on meeting certain conditions, the analyst thinks that there is a high probability that it would turn into definitive financing. Dayal’s optimism stems from various factors including regulatory tailwinds, the rising need for electricity, and increased interest in adopting clean fuels as the world moves toward green energy resources.
Importantly, Dayal noted that Plug Power should prioritize its Texas plant under the program first, as the company has already spent $300 million in capex on it. Also, PLUG will have eight more years to submit the remaining five projects.
Dayal Forecasts Improved Financials
Even though Plug Power’s Q1 results disappointed investors, Dayal sees improving financials following the DOE’s funding. The analyst forecasts net revenues to grow at a CAGR (compound annual growth rate) of 39.4%, increasing from $924 million in 2024 to $25.6 billion in 2034. He also expects Plug Power’s gross margins to improve from the negative levels seen today to 16% in 2025 and reach or exceed 20% by 2027.
At the same time, Dayal projects Plug Power’s operating costs to grow at a CAGR of 17.3% to $2.3 billion in 2034.
Is PLUG a Good Stock to Buy?
Not all analysts are as bullish about PLUG stock as Dayal. PLUG has a Hold consensus rating on TipRanks based on nine Buys, 11 Holds, and four Sell ratings. The average Plug Power price target of $4.96 implies 44.6% upside potential from current levels. Shares have plunged 57.5% in the past year.
Key Takeaways
Plug Power is poised to become a large hydrogen player with the support of the DOE’s funding. Dayal is highly bullish about the stock and expects to see the share price appreciate by over 420% in the next twelve months. Given the DOE’s funding, investors can consider this green hydrogen stock after thorough research.
