Trading Strategies for Plug Power Stock Before And After Q4 Earnings

Plug Power, Inc PLUG was trading over 4% lower Wednesday as the company heads into its fourth-quarter 2023 earnings print after the close.

When Plug Power printed a massive third-quarter earnings miss on Nov. 8, the stock was volatile the following day, surging up over 10% at one point before closing the session 1.35% lower. Over the subsequent four trading days, Plug Power surged 25% before continuing in its downtrend, which brought the stock to a Dec. 28 low of $11.49.

For the third quarter, Plug Power reported an earnings loss of 30 cents per share on revenues of $188.628 million, missing a consensus estimate of a loss of 23 cents on revenues of $248.41 million.

For the fourth quarter, analysts, on average, estimate Plug Power will report an earnings loss of 25 cents on revenues of $277.28 million.

On Feb. 23, RBC Capital analyst Chris Dendrinos reiterated an Outperform rating on Plug Power and maintained a price target of $20.

From a technical analysis perspective, Plug Power’s stock looks bearish heading into the event, having settled into a consistent downtrend on the daily chart.

It should be noted that holding stocks or options over an earnings print is akin to gambling because stocks can react bullishly to an earnings miss and bearishly to an earnings beat.

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The Plug Power Chart: Plug Power began trading in its most recent downtrend on Feb. 23 after attempting to regain the 200-day simple moving average as support and failing. The most recent lower high was formed on Tuesday at $15.03 and the most recent confirmed lower low was printed at the $13.91 mark on Friday.

• On Wednesday, Plug Power was working to print a bullish engulfing candlestick, which could indicate lower prices will come again on Thursday. If that occurs, bearish traders will want to see the stock form another lower low, which will confirm the downtrend is still intact.
• Bullish traders will want to see Plug Power print a bullish reversal candlestick, such as a doji or hammer candlestick, near the $14 mark, which would cause a double bottom pattern to form. If the stock reacts bullishly to its earnings print and rises above the most recent higher high, the downtrend will be negated and a possible uptrend could be on the horizon.
• Plug Power has resistance above at $14.20 and $16.20 and support below at $13.28 and $11.49.

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Photo courtesy of Plug Power.