Bloomberg
Plug Power Rocked by Accounting Errors After Its 1,400% Surge
(Bloomberg) — Plug Power Inc.’s accounting errors sent shares of the fuel-cell maker plunging on Wednesday, dragging down its peers.The Latham, New York-based company, which has soared more than 1,400% in the past year, tumbled 12%. Its industry counterparts Ballard Power Systems Inc. and FuelCell Energy Inc. also slipped, with the latter posting a first-quarter revenue miss this week.Plug Power said it found accounting errors in results for 2018, 2019 and the first three quarters of 2020. The disclosure is a setback for the company, which has struck a series of partnerships with companies including Renault SA and South Korea’s SK Group. It also came at a time when growth stocks have been hit by the climb in bond yields. The WilderHill Clean Energy Index has gained just about 1% this year, following a surge of more than 200% in 2020.“Anytime a company needs to restate results, investors shoot first and ask questions later,” said Jeffrey Osborne, a New York-based analyst at Cowen, who maintained a buy-equivalent rating, with a price target of $75 for the shares.B. Riley’s Christopher Souther also see a buying opportunity for Plug Power, while Truist Securities downgraded Plug to a hold recommendation.“Following these disclosures, we expect limited opportunity for outperformance in the near-term,” Truist Securities’ analysts said in a note to clients. “While the company reiterated long-term targets and the accounting issues appear transitory in nature, we see limited upside until resolution.”Investors piled into alternative energy stocks leading into President Joe Biden’s victory, and are now facing concern over high-flying valuations. Hydrogen has been touted as an alternative form of energy, while some participants remain unconvinced. Carlyle International Energy Partners recently called hydrogen power a “bubble.”See more: Clean Tech Valuations Are Wildly Out of Sync With Company ProfitFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
