PLUG Stock Jumps 10% as Plug Power Lands Record Contract

• Green hydrogen company Plug Power (NASDAQ:PLUG) announced a large electrolyzer order for a Danish company today
• This order provides up to 100,000 metric tons of renewable hydrogen each year
• That’s enough to power 15,000 heavy duty trucks, and apparently enough to power this stock higher today

Source: Postmodern Studio / Shutterstock

Today, one of the biggest movers in the market happens to be hydrogen fuel cell company Plug Power (NASDAQ:PLUG) after it announced a large order. This green hydrogen company has proven a volatile bet for investors over the past year. However, this volatility has worked in investors’ favor today. Shares of PLUG stock are surging 12% higher at the time of writing.

The big catalyst for today’s move in PLUG stock is a rather large order of a 1-GW electrolyzer to Danish company H2 Energy Europe. This massive electrolyzer will allow offshore wind energy to generate up to 100,000 metric tons of green hydrogen. Indeed, as the world shifts toward more renewable energy, such contracts are likely to become bigger and more consistent over time.

At least, shareholders in PLUG stock seem to think so.

Today’s surge indicates that the market believes this contract is telling of what may be to come for Plug Power. Let’s dive into some of the specifics and why investors are increasingly bullish on renewable hydrogen.

Why Is PLUG Stock Soaring Today?

Taking a step back, it’s clear that the overall sentiment of the market has shifted in a bullish direction today. Most stocks are up, with a sea of green encompassing the market heat map. In this environment, the companies with the greatest growth potential are often the ones that outperform to the greatest degree. That’s what we’re seeing today.

However, for investors in Plug Power, this announcement is certainly a company-specific catalyst to consider. Plug Power’s business model relies on the increased adoption of green hydrogen globally. This electrolyzer could fuel up to 15,000 heavy duty vehicles each day. That’s substantial, particularly when investors consider the size of the Danish market.

It’s noteworthy that Northern Europe has taken the lead, in many respects, on the renewable power front. Plug Power is seeing significant traction in its core markets, suggesting this business could be viable in North America. While the uptake for Plug Power’s services hasn’t been as rosy as expected, some may rightly suggest that the company’s current valuation reflects much of this bearish sentiment already. Accordingly, for those going bargain hunting, perhaps PLUG stock is too cheap to ignore.

Right now, I think the jury is still out on PLUG stock. This is a company that needs to gain more traction for mass market excitement to build. That said, the company is certainly moving in the right direction with today’s announcement.

On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

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