SPCE Stock – Why Plug Power Stock Dropped Today
Hydrogen fuel cell stock Plug Power (NASDAQ: PLUG) is down 7.8% as of 12:30 p.m. EDT Wednesday on no obvious news. In and of itself, though, that’s not surprising.
Plug stock hasn’t been trading particularly rationally lately, falling on “good” news Monday, then rising on “bad” news yesterday. And yet, today’s decline actually makes a bit more sense.
Consider: In yesterday’s note, analysts at investment bank Piper Sandler dinged Plug stock on worries that while hydrogen fuel might have some attraction as a “green” energy source, still has to compete with wind, solar, geothermal, and hydrogen power — all more widely accepted sources of renewable energy, and industries with established momentum.
While it’s true, therefore, that Plug Power stock might benefit from the $2 trillion infrastructure plan currently working its way through Congress, it’s also possible that this legislation will allocate the bulk of its “green money” to subsidizing solar, wind, and similar projects, rather than hydrogen fuel cells.
Image source: Getty Images.
And that’s what I think we’re seeing today: Investors gauging the chances of the infrastructure bill being a big benefit to Plug or not — and deciding today that “not” is the most likely answer.
Going forward, I’d expect that Plug Power stock will remain volatile as the prospects for hydrogen fuel cells winning subsidy money in the infrastructure bill ebb and flow. My advice to investors would therefore be to ignore this noise and wait on the sidelines until the bill’s language is finalized. Only then will we have actual facts to invest upon.
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Rich Smith has no position in any of the stocks mentioned. The Fintech Zoom has no position in any of the stocks mentioned. The Fintech Zoom has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.