The novel coronavirus has distracted some investors from industries with tremendous growth potential. Prior to the pandemic, Plug Power (NASDAQ:PLUG) stock was a hot topic among traders. It’s a tougher sell now because it’s not a “coronavirus stock.”
The world will return to normalcy sooner or later. And, the hydrogen fuel-cell revolution will pick up momentum. The global drive for cleaner energy sources will persist. A long position in PLUG stock is a simple way to express your bullish stance on this movement.
A Market With Outstanding Potential
One thing that makes Plug Power stand out is their participation in a clear and comprehensive road map to success. The company provided input into a data-rich manifesto that explains how America and the world are moving unavoidably towards a hydrogen-fueled economy.
This is strongly recommended reading for anyone considering a position in PLUG stock. Indeed, it’s worth reading, even if you choose not to buy the stock. Here are some of the highlights of the report:
- America is the fuel-cell electric vehicle leader with more than 7,600
of these vehicles currently on the nation’s roads.
- By 2030, U.S. hydrogen demand could reach 17 million metric
tons. And by 2050, this figure could reach 63 million metric
tons, which would equate to 14% of the nation’s final energy demand.
- Hydrogen has the potential to be a major job creator. In the U.S., the hydrogen economy could support 700,000 jobs, with that number increasing to 3.4 million jobs by 2050.
- The hydrogen-fueled economy is expected to be a large-scale generator of revenues. In fact, it could generate $140 billion per year in annual revenues in the U.S. by 2030, with that figure increasing to $750 billion per year by 2050.
- Up to 8 million fuel-cell electric vehicles could be sold in America by 2050. In that scenario, U.S. transport carbon emissions may be reduced by 30% and fuel-cell electric-vehicle energy use could constitute 8% of the nation’s total energy demand.
Those figures might sound ambitious. Even if those numbers don’t fully pan out, investors should still expect growth in the hydrogen fuel-cell market. The targets are long-term, so the coronavirus crisis will be a setback, but it won’t impede the hydrogen fuel-cell revolution on a permanent basis.
Capturing the Moment With Plug Power
The time to capitalize on this exciting movement is not years from now, when the price of PLUG stock will likely be much higher. Just as the hydrogen economy has a road map to success, so does Plug Power. Specifically, the company has a detailed plan that extends to 2024.
This five-year plan, which commenced in 2019, envisions “$1 billion of annual gross billings, $170 million of operating income, and $200 million of adjusted EBITDA” by the year 2024. And a glance at Plug Power’s record-setting performance in 2019 suggests that the company is on its way to meeting those 2024 targets.
Just to give an example, 2019’s fourth quarter saw $94.5 million in gross billings for Plug Power. That’s a quarterly record for the company and is more than 50% higher than any other quarter’s gross billings in Plug Power’s history. For the full year, the company’s gross billings came in at a remarkable $236.8 million.
Adjusted EBITDA is another way to measure the company’s profitability. This came in at $10.9 million during the fourth quarter of 2019, an impressive figure for a relatively small company. Plug Power chief executive officer Andrew J. Marsh proudly expressed his forward guidance based on these figures:
“I believe this year’s financial results demonstrates the viability of our business goal to achieve $1 billion in revenue and $200 million in EBITDA in 2024. For 2020, we expect $300 million in gross billings and $20 million in EBITDA.”
In other words, Plug Power is setting the stage for profitability not only through the remainder of this year, but through 2024 at the very least.
The Final Word on PLUG Stock
All of the foregoing data should convince any skeptic that the hydrogen fuel cell movement is here to stay. The coronavirus’s impact is going to be a factor, no doubt. Nonetheless, PLUG stock deserves your attention as both the industry and this specific company have compelling road maps to success for years to come.
Louis Navellier had an unconventional start, as a grad student who accidentally built a market-beating stock system — with returns rivaling even Warren Buffett. In his latest feat, Louis discovered the “Master Key” to profiting from the biggest tech revolution of this (or any) generation. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.