(Updated - May 15, 2014 7:37 AM EDT)

Cowen upgraded Plug Power (Nasdaq: PLUG) from Market Perform to Outperform with a price target of $6 (from $7.50). Analyst Robert Stone thinks the company is positioned for strong growth and recurring revenue.

"YTD bookings of $80MM (2x vs. 2013) point to a steep ramp from Q2 and profitability in Q4. Our factory visit yesterday (5/14/14) confirmed a high level of activity. A strong cash position should support expansion into hydrogen generation, Asia, and new product segments. Higher expenses and new shares reduce our PT to $6.00 (vs. $7.50)," said Stone.

Stone thinks PLUG should trade at a premium for several reasons:

1. a large, underpenetrated TAM of electric lift trucks;

2. leading (90%+) share in fuel cells for material handling

3. growing backlog of 5-6 year service and fuel contracts; and

4. a 5-6 year replacement cycle for GenDrive with existing customers like Central Grocers. EV/ Sales is currently <2.5x our 2016E (cash/share is $1.04).For an analyst ratings summary and ratings history on Plug Power click here. For more ratings news on Plug Power click here.

   Shares of Plug Power closed at $3.82 yesterday.