Plug Power Inc. (NASDAQ:PLUG), a once-promising growth stock, has been struggling badly this year, with its valuation collapsing an incredible 72% thus far in 2023. The company’s lack of profitability and overall high risk has made investors move away from the volatile green hydrogen stock.
The stock is now also oversold, finishing last week with a Relative Strength Index (RSI) of just under 29. When a stock has an RSI of less than 30, it is considered oversold. That doesn’t guarantee a turnaround for the stock, but it can indicate that there has been a lot of bearishness in the markets.
But there’s good reason for that. While Plug Power has created a commercially viable market for hydrogen fuel cell technology, it still has an uncertain future ahead. In the meantime, the company’s results simply haven’t been that strong.
Last quarter, it posted revenue of $199 million, which was up from $189 million in the same period last year. But the bigger issue is that its losses continue to mount as Plug Power’s operating loss of $274 million was 72% higher than the $160 million loss it reported in the prior-year period.
According to Wall Street analysts, the stock has an upside of more than 180% with the consensus price target at nearly $10. However, those price targets have been coming down and investors should be careful not to rely too heavily on them as more downgrades are likely coming.
Plug Power may be a promising green energy stock to own in the long run but for now, investors may be better off waiting until the company’s financials improve as there’s still significant risk with this stock.
