Is Plug Power Stock A Solid Long Term Investment?

Stock Market

When you are thinking about choosing a stock that you can use in order to make a rather significant amount of money for the long-term, it’s important to try to come up with something that is a little bit different. There’s no doubt about it, the stock market can be extremely volatile. That makes it hard to know with any level of certainty whether or not the stock that you choose is actually capable of performing the way you want it to. One of the criteria that a lot of people use involves trying to decide whether or not there is any potential for that particular company to see a dramatic increase in sales in the future. In other words, how is the stock going to perform in one year? Perhaps even more importantly, how will it perform within the next three to five years? Is it a market that has real potential for expansion or is it just some gimmick that’s going to end up going by the wayside sooner rather than later? All of these questions have to be answered. One stock that has been talked about recently is Plug Power (PLUG). Perhaps this is a stock that you’ve never even heard of before. If that’s the case, you’re not necessarily alone. The thing is, it probably won’t be very long until you’re starting to hear a great deal about it . The question is, is it good enough for you to use it as a solid long-term investment?

What Is Plug Power All About?

At this point, you might be wondering what the company is all about. That’s obviously a fair question. If you’re going to invest in something, especially when you’re doing it as a long-term investment, it’s imperative that you learn as much about it as possible. In this particular case, the company deals with all things related to hydrogen gas. At first glance, you might not think that’s such a big deal but in reality, many governments around the world are very interested in the type of technology the company is working on and they’re looking to do business with them. As a matter of fact, a lot of governments are looking toward the use of hydrogen gas to help heal the planet by changing the ecosystem. It almost sounds like something straight out of a science fiction movie, only it’s actually happening. As a result, the company seems like it is genuinely on the cusp of something much bigger than itself. If Plug Power ends up getting all of these government contracts, there’s no telling how much money this company could end up being worth in the long-term. At the moment, its future looks bright but then you also have the flip side of the coin. Right now, the stock is slightly down. In fact, it’s currently down by 0.62% on the DOW, 1.80% on the NASDAQ and 1.12% on the S&P. Is this just a little hiccup that the company is experiencing, the same kind of hiccup that all companies experience at one time or another? Is there something more to it that you need to be on the lookout for? All of these questions have to be answered before you know whether or not you should continue looking into this particular stock as one of your potential long-term investments. After all, you are doing this to make money, not lose it.

Why Does Hydrogen Matter?

If you’re still asking yourself how a company like this could potentially be viable in the long-term, that’s okay. You should be asking a lot of questions because that’s how you learn and make educated decisions instead of investing in something based off of some knee-jerk reaction that you end up regretting later. The reason that it matters is because the company is producing a wide range of hydrogen based products, all things that could potentially reverse the current trend that the human race is on when it comes to destroying the very planet we all live on. For example, they have the technology to incorporate hydrogen-powered buses that don’t produce the same type of emissions that traditional internal combustion engines do when they’re operating on fossil fuels. It’s a much cleaner energy that will ultimately change the way that people live their lives. As a matter of fact, they’re in the process of creating a number of different products that are all hydrogen-based. Anywhere that something is used that currently operates on fossil fuels, you can almost bet they’re working on a project that can convert it to hydrogen power instead. That’s precisely why various governments all over the globe are so interested in working with them. They seem to have unlocked a technology that people have been trying to harness for years, with little or no success. Obviously, the work that they’re doing has a strong foundation. The question is, do they have what it takes to succeed or are they going to end up like all of the other companies that have tried before them and failed? That’s what you need to know before you consider investing even a single dollar in their stock.

The Current State of Energy Stocks

If you follow the stock market in any capacity, it’s not going to come as a surprise to you that investors aren’t exactly thrilled about any stock that deals with energy at this particular point in time. As a matter of fact, they seem to be running from any company that deals with energy as fast as they can. If you’re asking why this is happening, it’s a relatively easy question to answer. Energy stocks are more volatile than other types of stocks as a whole. As a result, they have a tendency to be some of the first stocks that get bumped to the back of the line whenever anything happens that causes a ripple effect in the stock market. It can be something completely unrelated to that particular company itself. If there is a downturn in the economy, energy stocks (along with tech stocks) tend to be some of the first ones that get the ax. By the same token, world events can have a dramatic impact on them, especially when the particular stock in question is depending on a conglomerate of government contracts in order to come out on top in the long-term. Right now, there is a lot of discord between governments, largely with regard to what is going on between Russia and Ukraine. Until that starts to settle down, it’s highly unlikely that you’re going to see anyone becoming very friendly with energy stocks again. That might explain the current downturn in share prices. One thing that is worth noting is that while they have seen a downturn across the board, it has not been as significant as many other companies who also deal with energy. Perhaps it’s because investors feel like they have a stronger foundation. Obviously, more questions need to be answered.

Counting on the Future

There is something important that you have to realize when it comes to this particular stock and its potential viability as a long-term investment. Even the company is counting on things to go their way in the future. Currently, things are moving in the right direction but they’re not going nearly as fast as anyone would like to see them go. The energy sector is changing, but the public has traditionally been exceptionally resistant to this or any other type of change. As a result, the entire process is taking a lot longer than anyone probably thought it would. In particular, this company is counting on things to change in a big way with regard to aviation. They’re hoping to develop hydrogen fuel cells that can be used for air travel. Ultimately, they hope that they will be able to take those same hydrogen fuel cells and modify them to be used in military aircraft. If that is successful, the sky’s the limit with regard to how much this company could potentially become worth in the future. At the moment, it isn’t a reality and that is what is causing investors to balk at the idea of investing a great deal of money in the stock as a long-term option. If things fall through with regard to the aviation sector, there is a question of whether or not things will continue to progress rapidly enough with ground transportation for the company to see any significant gains in the next three to five years. It makes some investors nervous enough to back out. Others feel like the world must change, so it finally will make those changes because it’s no longer an option. They also feel like Plug Power is poised to take advantage of those changes when they do occur. That’s the thing. If they can harness these changes, they stand to make a ridiculous amount of money and so too do their investors. If things don’t go their way, they could become just like all of the companies that have come and gone before them, becoming nothing more than a memory in relatively short order.

The Forecast

At the moment, most stock market analysts believe that the stock will go up, but it’s not likely to go up as quickly as some might have hoped. In fact, the analysis shows that within the next 12 months, the stock is likely to go up to a little more than 33% per share. Typically, that would be considered a very good return on your investment, but there is one major caveat that you have to consider here. The stock is currently down by more than 20% over what it was last quarter. Is it really capable of rebounding like that and continuing on a positive trajectory or are people being far too optimistic about its potential progress? Most analysts believe that within five years, it will be up by a little more than 81% but it all hinges on their ability to get these government contracts and change the way that both public transportation and the military operate. Without those two factors coming together in their favor, it’s highly unlikely that things will go as predicted. The truth of the matter is that if things don’t go in their favor with regard to these major factors, they may not even be in business in five years. Considering the fact that things are progressing at a much slower rate than most people had predicted, there is a certain amount of cause for concern. Five years ago, many people predicted that all of these energy issues would be taken care of by now. The truth is, things are almost exactly the same with regard to that particular issue now as they were then.

Now that you have all of this information available to you, you can make an educated decision about whether or not you want to choose the stock as one of your long-term investment options. It is a risk and there is no doubt about that. If things come together, you might have the opportunity to enjoy a bigger payday than you could ever even imagine. If they don’t, you may not be able to get rid of your shares for even a fraction of what you paid for them. In the end, it comes down to your decision about whether or not you want to take the risk as well as how much you want to spend in the process. The most important thing to remember is that no one else can make that decision for you. Much of it comes down to how much discretionary income you have available to you, not to mention how you want to use that income. A lot of it also deals with how much risk you’re comfortable with absorbing. If you can handle the risk and it doesn’t make you a nervous wreck, then go for it.

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