Roth Lifts PT on Plug Power (PLUG) Following Q2 Results; Highlights Key Takeaways from the Quarter

Roth capital affirms Plug Power (Nasdaq: PLUG) at Neutral and moves its price target from $4.75 to $6.15 following Q2 results issued earlier in the week.

Analyst Matt Koranda noted the PLUG's Q2 results fell in-line with consensus. Revs of $17.3 million and adjusted loss of $0.04 per share compared with Roth's outlook calling for revs of $16.9 million and loss of $0.05 per share. The company also reaffirmed FY14 revenue expectations.

Koranda noted the following key takeaways:
1. Bookings: PLUG booked $87mn YTD, which is only a slight improvement from the $80mn figure shared on the Q1 call in May’14. Bookings tend to be lumpy, however, and management expects to exit Q3’14 with ~$115mn booked YTD;
2. Quality issues: PLUG is addressing a mix of issues with its high-powered stack at customer sites. Management does not view these as major problems, however, and is working with service personnel and its suppliers to fix the problems;
3. Walmart: PLUG’s goal is to deploy 5-10 sites with Walmart during 2015; and
4. Hypulsion: PLUG is in discussions to assume majority control of its European JV by early-2015.

Estimate changes: We increase our 2014 revenue forecast to $75 million (vs. prior consensus of $74 million and prior ROTHe of $70 million). Our GM estimate is slightly higher at 6.1% vs. prior consensus of 11.3% and prior ROTHe of 4.3%, largely driven by PLUG’s Q2 performance. Increased OpEx mitigates the benefit of higher revenues and GMs and we maintain our adjusted 2014 EPS estimate of -15c, vs. prior consensus of -10c.

For an analyst ratings summary and ratings history on Plug Power click here. For more ratings news on Plug Power click here.

Plug Power closed at $6.11 yesterday.

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