Plug Power Inc. (NASDAQ:PLUG) shares slid after investors weighed news of a proposed class-action lawsuit alleging securities fraud linked to the company’s expectations around U.S. Department of Energy funding.
The pullback comes just days before the company’s fourth-quarter results and ahead of incoming CEO Jose Crespo’s first official week at the helm.
Fraud Lawsuit Hits
A proposed securities class action alleges Plug Power materially misled investors about its ability to secure and utilize a $1.66 billion Department of Energy (DOE) loan guarantee tied to hydrogen production projects.
The complaint — Ortolani v. Plug Power Inc. et al., No. 1:26-cv-00165 — filed in the U.S. District Court for the Northern District of New York, claims the company overstated its prospects of obtaining the loan guarantee, which was intended to finance up to six hydrogen production facilities. The suit further alleges that Plug misrepresented its ability to construct and execute on those projects.
The case was brought under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. Investors have until April 3, 2026, to seek appointment as lead plaintiff.
According to the complaint, the alleged misstatements were followed by three significant stock declines:
- Shares fell 6.3% on Oct. 7, 2025, after CEO Andrew Marsh and President Sanjay Shrestha abruptly departed.
- The stock dropped 3.4% on Nov. 10, 2025, when Plug suspended activities related to the DOE loan.
- Shares plunged 17.6% on Nov. 14, 2025, after a Washington Examiner report said all six planned hydrogen facilities had been scrapped, potentially jeopardizing the full $1.66 billion loan guarantee.
$132.5M Asset Sale
Separately, Plug Power agreed to sell its Project Gateway site in New York for at least $132.5 million in gross proceeds, with the transaction potentially reaching $142 million.
The sale is part of a broader asset monetization strategy aimed at generating more than $275 million to strengthen liquidity.
The transaction includes Plug’s ownership interest in the Project Gateway site, along with related land and infrastructure.
The company said the move is designed to streamline operations and refocus resources on its core hydrogen production and fuel cell deployment initiatives.
Technical Analysis
Plug Power is currently grappling with a bearish trend across multiple timeframes. The stock is trading 8.6% below its 20-day SMA, 15.6% below its 50-day SMA, and a significant 25.7% below its 100-day SMA.
This positioning suggests a lack of short-term confidence from investors, compounded by broader market downturns.
The technical indicators provide a mixed outlook; the RSI stands at 43.52, indicating a neutral market sentiment, while the MACD shows a slight bullish signal, suggesting potential for a short-term recovery.
However, the overall trend remains cautious as the stock struggles to regain its previous highs.
Upcoming Earnings
Plug Power is set to report earnings on March 2, 2026. Here’s what analysts are expecting for the upcoming quarter:
- EPS Estimate: Loss of 10 cents (Up from a loss of $1.65 YoY)
- Revenue Estimate: $218.70 million (Up from $191.47 million YoY)
Analyst Consensus & Recent Actions: The stock carries a Hold Rating with an average price target of $2.38. Recent analyst moves include:
- TD Cowen: Downgraded to Hold (Lowers Target to $2.00) (Jan. 9)
- Clear Street: Upgraded to Buy (Lowers Target to $3.00) (Dec. 31, 2025)
- Canaccord Genuity: Hold (Maintains Target to $2.50) (Nov. 20, 2025)
PLUG’s Significant Weight in Key ETFs
- Global X Hydrogen ETF (NASDAQ:HYDR): 12.33% Weight
- Research Affiliates Deletions ETF (NASDAQ:NIXT): 1.44% Weight
- Direxion Hydrogen ETF (NYSE:HJEN): 6.90% Weight
Significance: Because PLUG carries such a heavy weight in these funds, any significant inflows or outflows will likely trigger automatic buying or selling of the stock.
PLUG Price Action: Plug Power shares were down 7.32% at $1.77 at the time of publication on Friday, according to Benzinga Pro data.
Photo via Shutterstock
