What: Shares of Plug Power Inc dropped as much as 15% today after the company released second-quarter earnings.
So what: Quarterly revenue was up 39% to $24.0 million, but the company swung from a profit of $3.8 million a year ago to a $9.3 million loss. On an adjusted basis, the company lost $0.06 per share, which was a penny better than expectations. The problem is that analysts expected $25.2 million in revenue, and for a company with high growth goals, that's a problem for Plug Power.
Now what: Even a hint of slower-than-expected growth can lead a stock like Plug Power to sink, and that's what we're seeing today. But I actually see some positive signs in the results. Product gross margin improved from 17% a year ago to 24%, and total gross margin was up from 1% to 7% over the same time. That hasn't led to a profit yet, but it's progress for a growing company.
I'd like to see more financial progress and even a profit before jumping in, but long-term investors should like what they're seeing operationally, and the falling stock price could make this a good value for investors someday.
The article Why Plug Power Inc's Shares Plunged 15% Today originally appeared on Fool.com.
Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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