Plug Power (PLUG, Financial) has a long history of not delivering on its promises and disappointing investors. The fuel cell maker has consistently underperformed and has destroyed shareholder value by diluting stocks. Thus, the organization's stock has lost over a large portion of its value as the company is struggling to increase its top and bottom line. The organization further disappointed investors by bringing down its FY 2015 revenue guidance and given the company’s history, I don’t find it surprising.
Plug Power's gross margin has been consistently moving in the wrong direction. In spite of the fact that the organization's gross margin has moved in the last couple of years, regardless it remains at -12.5%. The organization's administration anticipates that gross margin will achieve 25% in 2015. In any case, given that Plug Power has hugely neglected to meet its guidance before, I don't believe its gross margin will enhance at any point in the near future. In 2009, Plug Power's CEO Andy Marsh, said that:
The company will achieve a gross margin percentage in the mid-teens.
Then in 2011, Marsh said:
Plug Power expects margins to top 20% in 2012, and reach 30% in 2013.
The company failed to deliver every time, and I don't think it will get anywhere close to its gross margin target of 25% in 2015.
Draw back to its technology
The introductory expenses to gain GenDrive, Plug Power’s primary revenue generator, technology for intrigued organizations can sometimes be restrictively pricey. Notwithstanding, there is an arrival on venture. The issue for Plug is that it can't enter numerous lower and center market organizations –Â no sweat in light of the fact that the high expenses with respect to conventional basically isn't attainable for these organizations. Over the long haul the general expense investment funds are great, and there is an arrival on venture; however, the beginning expenses unmistakably upset requests as it takes years to understand the arrival on speculation. I think that, as the technology gets to be more standard, the expense of hydrogen refueling stations and item improvement will descend yet until further notice expenses are averting exponential development. In any case, it is getting on, as proven by the final quarter.
Conclusion
Plug Power has a history of never delivering on its guidance, and the company keeps making fake promises to manipulate stock price. The company is also facing a lot of headwinds going forward, and its GenDrive may not be able to make up for all the losses. Hence, I reckon the stock should be avoided at all costs.
