The Crowd Is Dumping Plug Power. Here's Why I'd Be Buying It Down 40%.

Plug Power's (NASDAQ: PLUG) stock hit a 52-week high of $4.58 per share on Oct. 6, 2025. At the time, investors were impressed by the hydrogen company's accelerating sales growth and narrowing losses, and it looked like a bargain relative to its long-term growth potential.

But since then, Plug Power's stock has declined more than 40% amid fears of interest rate hikes, reduced clean energy subsidies, and the sluggish adoption of hydrogen technologies. However, I believe the pullback represents a good buying opportunity for bold investors.

Image source: Getty Images.

Why is Plug Power growing again?

Plug Power sells hydrogen fuel cells, charging systems, electrolyzers, and storage systems. Amazon and Walmart, the company's two largest customers, both use those fuel cells in their hydrogen-powered forklifts.

Plug Power's number of deployed fuel cell systems rose from approximately 50,000 at the end of 2021 to more than 74,000 at the end of 2025. Most of that expansion occurred in 2022 and 2023, and it was amplified by its acquisitions of two cryogenic storage companies.

Data source: Plug Power. YOY = Year-over-year.

In 2024, Plug Power's growth stalled out as the macro headwinds drove many companies to suspend their expensive hydrogen charging projects. But in 2025, its revenue rose again as interest rates declined and it ramped up its production of green hydrogen.

For 2026, analysts expect Plug's revenue to rise 15% to $813 million with a narrower net loss of $492 million. Its top-line growth should be driven by its recent 275 MW electrolyzer contract for Hy2gen's Courant green hydrogen project in Quebec, the U.S. Department of Energy's construction of six new green hydrogen facilities, the execution of its binding tax incentive agreement in Uzbekistan, and the broader market's growing interest in hydrogen power.

Plug Power will also ramp up first-party hydrogen production at its plants in Georgia, Tennessee, and Louisiana to reduce its dependence on expensive third-party fuel. It expects that transition, along with the other cost-cutting measures of its "Project Quantum Leap" plan, to drive its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) into positive territory for the first time by the fourth quarter of 2026.

Why is Plug Power's stock still reasonably valued?

By 2028, analysts expect Plug's revenue to reach $1.16 billion (an 18% CAGR from 2025) with its first full-year positive adjusted EBITDA of $39 million. The AI data center, industrial, transportation, and power generation markets should drive that growth.

According to Grand View Research, the green hydrogen market could expand at a 30.2% CAGR from 2026 to 2033. As the largest "pure play" hydrogen power company in the U.S., Plug is well-positioned to capitalize on the market's secular expansion.

With a market cap of $3.9 billion, Plug Power trades at 4.8 times its 2025 sales and 3.4 times its 2028 sales. Those price-to-sales ratios look reasonable relative to its growth potential, but its liquidity concerns and reliance on government subsidies are compressing its valuations.

Plug still had $802 million in cash, cash equivalents, and restricted cash at the end of the first quarter of 2026. Still, total liabilities were $1.59 billion, giving it a debt-to-equity ratio of 2.1. It's also more than doubled its share count over the past three years.

That pressure will continue until economies of scale kick in. However, Plug could be revalued as a growth stock once more investors recognize its role in powering the power-hungry cloud and AI markets with green energy. It will remain volatile in this choppy market, but it could generate multibagger gains over the next few years if it merely matches analysts' expectations.

Leo Sun has positions in Amazon. The Motley Fool has positions in and recommends Amazon and Walmart. The Motley Fool has a disclosure policy.