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Plug Power, Inc. (NASDAQ:PLUG) shares fell Wednesday after the company announced a $375 million private offering of convertible senior notes.
JP Morgan analyst Bill Peterson maintained a Neutral rating and withdrew the price forecast for the company.
Plug Power announced a $375 million private offering of convertible senior notes due 2033 shortly after Tuesday’s close.
Also Read: Plug Power Wins 55 MW Green Hydrogen Contract In UK
The proceeds will be used to retire $243 million of 15% high-cost debt and repurchase a portion of its 2026 convertible notes.
While the stock dipped in after-hours trading, the move ultimately makes sense from a de-leveraging standpoint, the analyst says.
The Neutral rating reflects a cautious stance while monitoring execution on key financial targets, especially profitability and cash burn reduction.
Although operational momentum and strategic direction have improved over the past year, consistent progress on margin and liquidity goals is necessary before adopting a more positive outlook, adds the analyst.
Also, the analyst shared key takeaways from the company’s 2025 Symposium.
The analyst notes that Plug reiterated its fiscal 2025 and fiscal 2026 guidance, projecting significant quarter-over-quarter and year-over-year margin improvements on an adjusted basis that excludes large non-cash charges from the third quarter of 2025.
Gains are expected from higher sales volume, a stronger equipment mix, better fixed-cost absorption, and improved contribution margins on equipment, adds the analyst.
Peterson writes that YE26 guidance anticipates EBITDAS turning positive, underpinned by ~$300 million in the fourth quarter of fiscal 2026 sales (versus pre-call JPMe/consensus $244 million/$251 million) and 15% gross margins (versus -3%/8% consensus), likely reflecting stronger equipment sales.
Fiscal 2025 EBITDAS excludes stock-based compensation (~$12 million quarterly run-rate in fiscal 2025 versus ~$20 million in fiscal 2024), supporting the goal of reaching EBIT positivity in fiscal 2027 and net income positivity in fiscal 2028, as outlined at the 2024 Symposium, adds the analyst.
Looking ahead, the analyst expects the growth to be supported by the 2026 renewal of investment tax credits, continued fleet upgrades, and capacity expansion from key accounts, while greenfield projects offer additional upside by avoiding legacy electrical infrastructure costs.
Price Action: PLUG shares were trading lower by 15.65% to $1.805 at last check Wednesday.
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Posted In: PLUG
