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SLINGERLANDS, N.Y. - Plug Power Inc. (NASDAQ:PLUG), a company specializing in hydrogen fuel cell systems, has priced its underwritten public offering at approximately $280 million, as the company faces significant cash burn challenges according to InvestingPro analysis. The offering includes 46.5 million shares of common stock and pre-funded warrants to purchase an additional 138.9 million shares, collectively termed as Common Stock Equivalents, along with accompanying warrants for each share and warrant unit sold. The move comes as the stock has declined over 50% in the past year, though current analysis suggests the stock may be undervalued.
The combined offering price for each share and accompanying warrant is set at $1.51, while each pre-funded warrant and accompanying warrant is priced at $1.509. The pre-funded warrants will be exercisable immediately with an exercise price of $0.001 per share and will expire three years from the date of issuance. The accompanying warrants, with an exercise price of $2.00 per share, will be exercisable six months post-issuance and also carry a three-year expiration term.
Plug Power anticipates using the net proceeds from this offering to support working capital and general corporate purposes. With a current market capitalization of $1.5 billion and an EBITDA of -$1.03 billion in the last twelve months, the company’s financial health score is currently rated as WEAK by InvestingPro analysts. Andy Marsh, CEO of Plug Power, commented on the offering, stating that it will bolster the company’s financial position and contribute to profitability in 2025. He emphasized the company’s commitment to optimizing operations and focusing on strategic initiatives for sustainable growth, despite the company’s revenue declining by 29.45% in the most recent period.
The offering is expected to close on or about March 20, 2025, subject to the satisfaction of customary closing conditions. Oppenheimer & Co. Inc. is serving as the sole book-running manager for the offering, with Roth Capital Partners, LLC, Craig-Hallum Capital Group LLC, and H.C. Wainwright & Co. acting as co-managers.
The securities are being offered pursuant to an automatic shelf registration statement filed with the Securities and Exchange Commission (SEC) and declared effective on June 8, 2022. Relevant documents, including a prospectus supplement, have been filed with the SEC and are available for public access.
Plug Power’s business encompasses the production and deployment of electrolyzers, liquid hydrogen, fuel cell systems, storage tanks, and fueling infrastructure. The company has a significant footprint in the green hydrogen economy, with over 72,000 fuel cell systems and 275 fueling stations deployed, and is expanding its hydrogen production capacity. While the company maintains a healthy current ratio of 1.97, indicating strong short-term liquidity, InvestingPro has identified 12 additional key investment factors that could impact the company’s future performance. Access the comprehensive Pro Research Report, available for over 1,400 US stocks, for detailed analysis and expert insights.
This news article is based on a press release statement from Plug Power Inc.
In other recent news, Plug Power has reported its fourth-quarter earnings, which did not meet expectations, influencing analysts to adjust their projections. Jefferies revised the company’s stock price target to $1.70, maintaining a Hold rating, reflecting the delayed revenue from 2024 and potential challenges in realizing cost savings. Craig-Hallum also lowered its target to $2.50 but maintained a Buy rating, emphasizing the need for the company to focus on core sectors and cost optimization. TD Cowen retained a Buy rating with a $4.00 target, optimistic about Plug Power’s strategic plan to achieve profitability by the end of 2025 through initiatives like Project Quantum Leap.
Canaccord Genuity reduced its price target to $1.25, maintaining a Hold rating due to uncertainties and the need for more evidence of progress in Plug Power’s financial performance. Oppenheimer reiterated a Perform rating, recognizing the company’s cash management efforts and potential savings, while noting the need for additional capital to sustain operations into 2026. Plug Power’s focus on material handling, electrolyzers, and fuel production remains central to its strategy, with planned production increases at facilities in Louisiana and Texas. Analysts agree that achieving positive gross margins and EBITDA is crucial for the company’s future growth. Investors are closely monitoring Plug Power’s progress as it works towards its 2025 profitability goals amid these strategic shifts and financial challenges.
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