Call Traders Blast Red-Hot Plug Power Stock

The equity is up over 1,480% year-over-year

Digital Content Manager
Jan 14, 2021 at 3:12 PM
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The shares of Plug Power Inc (NASDAQ:PLUG) are down 4.3% to trade at $66.47 at last check, after J.P. Morgan initiated coverage of the security with a "neutral" rating and a $60 price target, which is roughly a 14% discount to last night's close. The brokerage firm said that while the alternative energy concern is best-in-class in the hydrogen and fuel cell space, with tremendous sales growth potential going forward, it is also "fully-valued" in their view. 

What's more, the energy concern appeared on Schaeffer's Senior Quantitative Analyst Rocky White's list of stocks that have attracted the highest weekly options volume within the last two weeks, with new names to the list highlighted in yellow. More specifically,  348,231 weekly calls, and 180,006 weekly puts have crossed the tape in the past 10 days.

MAO 0114

PLUG has seen tremendous growth over the past year, culminating in a Jan. 13, all-time-high of $73.90. The ascending 20-day moving average has been consistent support on the stock's journey to new heights, while today's pullback appears to have lost steam around $64. However, it's important to keep in mind that year-over-year, PLUG sports an astounding 1,481.7% lead.

PLUG 20 Day

Analysts were bullish toward the security coming into today, with eight of the nine in question calling it a "buy" or better. Meanwhile, the 12-month consensus target price of $51.14 is a 23% discount to current levels, meaning price-target hikes could still be on PLUG's horizon.

And while shorts are already hitting the exits, there is plenty of pessimism left to be unwound, which could push the security higher. Short interest fell 4.6% in the last two reporting periods, and the 63.50 million shares sold short account for a whopping 27.6% of the stock's available float.

Tailwinds could also come from a shift in the options pits. This is per PlugPower stock's Schaeffer's put/call ratio (SOIR), which stands higher than all readings from the past 12 months. In other words, short-term options traders have rarely been more put-biased.

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