FuelCell Energy, Inc. (NASDAQ: FCEL), Plug Power, Inc. (NASDAQ: PLUG) – JPMorgan says the power plug’s hydrogen stock is trading at a ‘steep price’, reduces FuelCell’s energy

Hydrogen Power Company Plug Power Inc (NASDAQ: PLUG) is a pioneer and fast in the hydrogen fuel cell space, but the shares are traded at a “high price”, according to JPMorgan.

The Plug Power Analyst: Paul Coster started covering Plug Power with a neutral rating and target price of $ 60.

The Plug Power Thesis: Plug Power was one of the first participants in the $ 200 billion electrification of the transport and logistics market, Coster said in an opening statement on Thursday.

The company is able to support its year of operation with proven proton exchange membrane technology, a strong balance sheet and large customers and partners, said the analyst.

This gives the company an attractive path to earn $ 1.2 billion in sales by 2024 and make a profit, he said.

In fact, the recent partnerships of SK Group and Renault of Plug Power could raise its sales outlook in 2024 to $ 1.7 billion, and revenue growth will continue to accelerate in 2025, said Coster.

Still, JPMorgan’s $ 60 price target is based on a valuation model discounted 60 times the $ 534 million EV / 2025 EBITDA forecast.

“Welcome to the investment in hydrogen fuel cells,” said the analyst.

Related Link: Why Plug Power is the Lead in the Fuel Cell, the Hydrogen Space Could Create ‘Extraordinary Winner’

Why JPMorgan is downgrading FuelCell: Separately, Coster downgraded FuelCell Energy Inc’s (NASDAQ: FCEL) Stock rating from Neutral to Underweight.

The stock has risen 70% since the beginning of 2021 and more than 800% last year. The shares are trading at about 50 times the price / future sales and are “richly valued” compared to their peers, the analyst said.

“At this point, we expect the shares to perform below the average of our coverage in the next 6 to 12 months, although we remain constructive in relation to the Alt Energy sector in general.”

PLUG, FCEL Price Action: Plug Power shares lost 4.26% in Thursday’s session, closing at $ 66.54, while FuelCell Energy plunged 8.05% to $ 17.60.

Photo courtesy of Plug Power.