“When we look at everything, we feel very confident,” Marsh told Yahoo Finance (video above). “When we look at our ability to handle this, we’re going to be fine. We’re talking to people about opportunities to raise money.” We have far more cash than we need. We’re just trying to be prudent so that our investors are well-positioned for the long term.”
Plug Power shares plunged on Friday and remained under pressure on Monday. The sell-off came after the company reported lower-than-expected results and warned of “continuing concern” that it might not be able to fund operations next year.
“Based on the projected capital expenditures and operating requirements of the Company’s current business plan, the Company anticipates that its existing cash, available-for-sale and equity securities will be insufficient to fund its operations for the next twelve months,” the company said in a Thursday release “These circumstances and events cast substantial doubt on the company’s ability to continue as a going concern,” the filing reads.
On Monday, Marsh painted a more optimistic picture of the company’s prospects, saying it plans to act “cautiously” so that investors are “well-positioned for the long term.” He emphasized that the company has “zero debt.” and “a $5 billion unlevered balance sheet.” Marsh also said Plug Power is considering a range of options, including raising $500 million in debt financing and slowing the pace of plant openings.
“I would be disingenuous if I didn’t say it was a bump in the road,” Marsh said. “But there is strong demand from our major customers.”
Plug shares down more than 70% year to date as clean energy stocks fall excessive beatingdriven by concerns about rising interest rates and falling valuations in capital-intensive industries.
Marsh added, “If the market grew a little faster, it would make it easier.”
In the third quarter, Plug Power lost $0.47 per share, beating Wall Street expectations for a loss of $0.30 per share. Net revenue for the quarter was $198.7 million. The company’s net loss for the quarter totaled $283.5 million.
In its earnings report, the company blamed the loss on “unprecedented supply challenges” for hydrogen, which it said had led to production constraints and deployment delays. Plug plans to commission two new green hydrogen production plants in Georgia and Louisiana, causing supply disruptions. said the Georgia plant alone, scheduled to open by the end of the year, would be enough to relieve the pressure.
JPMorgan Chase, Oppenheimer and RBC Capital all downgraded the stock and lowered their price targets after Prager reported Thursday’s results.
“While we believe Plug Power can overcome its current cash flow issues, the current operating and capital markets environment is challenging,” J.P. Morgan’s Bill Peterson wrote in a note to clients. Analysts downgraded the stock to “neutral” and lowered the price target to $6. Starting at $10 per share.
Akiko Fujita is an anchor and reporter for Yahoo Finance.Follow her on Twitter @ Fujita Akiko.