Will Plug Power Stock Quadruple Your Money in 2026?

Key Points

• Plug Power stock is on a roll.

• New investors should understand what they are buying into.

• 10 stocks we like better than Plug Power ›

Plug Power (NASDAQ: PLUG) stock has had a number of huge runs over the years. The company is a popular hydrogen stock, a category of business that could grow rapidly as demand rises for renewable energy.

This year alone, from trough to peak, Plug Power shares nearly quadrupled in value. Many investors have jumped in hoping that the surge continues. But before you jump in yourself, there are two things you should understand.

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Can hydrogen power meet growing global demand for clean energy?

Before we look at the specifics of Plug Power, it's important to understand why investors have become infatuated with the stock time and time again since the company's initial public offering in 1999.

To put it simply, the world is racing to scale up new forms of energy production that create less pollution and carbon emissions. Some of this is driven by government regulation, but a lot of the demand has been created by businesses themselves. Alphabet, the parent company of Google, for example, is funding the construction of new nuclear power plants to power its data center business.

Many other companies, especially those exposed to the rapid rise of artificial intelligence, are working to get their own sources of clean energy online. For the most part, existing grids aren't scaling production fast enough to meet the needs of these companies, and none want to invest in a legacy fuel source with an uncertain long-term regulatory climate.

There's a lot of competition when it comes to getting renewable energy to the countries and companies that demand it. Solar and wind continue to fall in price, and in general are reliable sources of clean power, though intermittent production makes them less reliable for projects like data centers. Nuclear is a great substitute, but construction costs and long lead times have prevented this source of energy from scaling, though small modular reactors could change that equation over the next three to five years.

What about hydrogen fuel? The technology is fairly proven, with many real-world use cases globally. But scaling has been difficult. Even after decades of investment, hydrogen fuel remains uncompetitive versus most other renewable energy sources. The refueling infrastructure for use cases like transportation, meanwhile, remains nearly nonexistent. And hydrogen fuel itself requires a lot of energy to produce, a challenge that requires other energy sources to solve.

The promise of hydrogen energy has caused many investors to predict a huge ramp in demand over the long term. But experts have needed to lower their demand forecasts repeatedly due to the persistent challenges mentioned above.

Image source: Getty Images.

Plug Power stock isn't a great option for betting on the hydrogen revolution

Even if hydrogen fuel takes off, Plug Power likely isn't your best bet when it comes to investing. There's a reason why Wall Street analysts are so bearish on the stock.

Plug Power has been a money-losing business for decades. Over the last 12 months, the company has posted a negative profit of nearly $2 billion. That's nearly the entire market cap of the company! Heavy share dilution has kept the company afloat, but a lack of profitability has prevented it from advancing its technology to keep pace with the competition.

According to Thunder Said Energy's recent review of the company's patent portfolio, for instance, "raised some question marks ... around where the 'focus' and 'moat' really are in the business." For example, Bloom Energy, a Plug Power competitor, claims the its solid oxide electrolyzers can deliver better efficiencies at higher temperatures, potentially creating 20% to 25% more hydrogen per unit of energy inputted.

In short, there's no guarantee that the hydrogen economy will ever take off at any meaningful scale, nor is there strong visibility into Plug Power becoming a winner should the hydrogen economy ever become a reality. The latest stock run for Plug Power is likely a reflection of short-term market hype around a small-cap stock, not the harbinger of long-term gains.

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Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet. The Motley Fool has a disclosure policy.