Plug Power stock price forecast for Q4 amid hydrogen fuel cell expansion plans
- Plug Power shares on Wednesday edged lower 1.23% after revealing new hydrogen fuel cell expansion plans.
- The company and SK Group have formed a joint venture to build a gigafactory in South Korea by 2024.
- The joint venture will also distribute SK liquefied hydrogen to about 100 charging stations in the country.
On Wednesday, Plug Power Inc. (NASDAQ:PLUG) shares edged lower 1.23% despite announcing a joint venture with South Korea’s SK Group for hydrogen fuel cell expansion.
The companies said they plan to build a gigafactory in South Korea by 2024. It will have a mass capacity for hydrogen fuel cells and electrolyzer systems that will enable it to supply the domestic market and certain overseas markets in Asia.
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The joint venture will also distribute liquified hydrogen produced by the SK Group to approximately 100 stations nationwide.
According to the agreement, the Leetham, NY-based electrical equipment company will own 49% of the joint venture, with SK owning 51%.
The South Korean company invested $1.5 billion in Plug Power earlier this year in a bid to accelerate hydrogen fuel cell expansion in Asia.
Should you bet on PLUG’s exciting growth?
From an investment perspective, Plug Power is yet to swing to profits on a trailing 12-month basis, with some of its most promising projects closer to generating revenues. As a result, PLUG power looks like an exciting growth stock, rather than a value stock.
Therefore, investors willing to overlook short-term headwinds could stand to benefit significantly when the projects begin to pay off.
The company’s joint venture with SK could give it access to some of the exciting markets in Asia, creating a catalyst for growth.
Can PLUG bounce back?
Plug Power shares appear to be trading within a descending channel formation in the intraday chart. As a result, the stock price has fallen to trade closer to the oversold conditions of the 14-day RSI.
However, the stock seems to have found support around the $24.40 level, creating an opportunity for a rebound. Therefore, investors could target potential rebounds at approximately $29.30, or higher at $34.57.
On the other hand, if the stock price continues to decline, it could find support at $19.40, or lower at $13.75.
The short term could be bumpy
In summary, although Plug Power shares are down more than 66% since hitting the current 52-week high of $75.49 in January, the downward movement seems likely to continue.
The stock lacks significant short-term catalysts to initiate a solid rebound.
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