what happened
Yesterday the shares of Plug power (NASDAQ: PLUG) increased by 35%. The gains continued today with shares up another 11% from 14:00 EST.
The 50% jump over the past two days is still fading compared to the share of almost 1,600% since the beginning of 2020.
Approximately
The recent upswing was prompted by the announcement of a new strategic agreement with the SK Group in South Korea, which will inject $ 1.5 billion into the company in exchange for a 10% stake in SK Group.
Image Source: Getty Images.
The partnership plans to supply “hydrogen fuel systems, hydrogen stations and electrolysers to the Korean and broader Asian markets.”
Now what
Further support for the sector has come in recent days as the by-elections in Georgia reaffirm the democratic control of both houses of Congress. Investors believe federal support is now more likely to build green energy infrastructure.
But the stock’s excessive profit over the past year has also come with the dilution of shares to investors.
PLUG data by YCharts
Outstanding equities grew by more than 40% as the stock rose to its current market capitalization of more than $ 20 billion. For a still unprofitable company, this is a valuation based solely on potential. But the potential market can be huge. Investors should monitor Plug Power’s upcoming business update on January 26 to see if it can provide a current timeline for profitability, and decide if the valuation in this fast-changing industry seems justified.