Energy Plug Power Inc (NASDAQ:PLUG): Cowen Sees More Than 70% Upside Today, Raises PT to $3

Plug Power Inc (NASDAQ:PLUG): Cowen Sees More Than 70% Upside Today, Raises PT to $3

Published By News Desk at April 7, 2017 08:27 am Amazon to use Plug Power's hydrogen technology and fuel cells in fulfillment network, according to Cowen analyst

Cowen analyst Jeffrey Osborne weighed in on Plug Power Inc (NASDAQ:PLUG) following the recently announced supply deal with, Inc. (AMZN). While being optimistic over the deal, the analyst maintained his Outperform rating on the shares but raised price target by about 71.43% from $1.75 to $3. On April 5, Plug shares skyrocketed 73.08% following the news but closed down 4.89% yesterday. Moreover, the shares fell 2.34% further in late trading Thursday.

According to Mr. Osborne, under the new deal, Amazon is expected to utilize Plug Power’s hydrogen technology and fuel cells in its fulfillment network. In his research note, the analyst further suggested that the new development provides confidence on the New York-based company’s outlook. This is because deal also provides a warrant to Amazon to buy 20% stake in Plug Power along with commercial payments totaling to $50 million.

Marketwatch report further suggested that the deal with Amazon could be worth up to $600 million and has a potentially huge equity investment. While being excited about the deal, FBR Capital Markets analyst Carter Driscoll highlighted other ways in with the $909.26 million business could benefit from the deal. He stated, “The agreement could benefit Plug Power in other says, such as by helping coax existing customers to expand to multisite supply deals. There is also a technology collaboration aspect to the deal which could help Plug Power develop technology for use in other industries, including mobility.”

Wall Street analysts have given Plug Power a 12-month average price target of $2.15, one cent higher than the company’s last closing price. Moreover, out of five analysts covering the shares at FactSet Fundamentals, four recommended the company as Buy, while one analyst suggested holding the stock in the longer term.