• PLUG issues a going concern notice
• Need to raise cash to survive the next 12 months

The hydrogen producer and fuel-cell maker crashed 47% since its earnings day last Thursday after the company not only missed top and bottom lines by miles but also included a “going concern notice” in its latest 10-Q report, indicating it might not survive the next 12 months unless it does “the usual” securities offering for which it is well known among seasoned traders.

Revenue came at 198.71M vs. 219.57M expected (-9.5% miss). Further, company losses jumped to 0.47 per share from 0.30 year-over-year, higher than the consensus of 0.30 per share loss. PLUG cited that it “has been negatively impacted by unprecedented supply challenges in the hydrogen network in North America.”

Cash & available-for-sale securities balance declined from $2 billion at the end of last year to around $500 million in the span of 9 months, or over $166m per month. If we extrapolate that cash burn rate, PLUG will run out of money in 3 months.

Hence, the company included a “substantial doubt about its ability to continue as a going concern” as PLUG expects its “existing cash and available for sale and equity securities will not be sufficient to fund operations ” over the next 12 months.

On top of that, PLUG’s expected government support through hydrogen tax credits was delayed.

The company was nearly $1600 at the start of the millennium. Since then, it has nosedived all the way down to $3.53 in early Monday trading.

The endless number of reverse splits, accompanied by an endless number of offerings, to satisfy the NASDAQ listing requirements so that it could tap into the debt and equity markets has resulted in an endless dilution cycle for shareholders.

In the wise words of Mark Twain: “History never repeats itself, but it does often rhyme” or simply some things never change.

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Alternatively, they can long PLUG using our 1x Plug Power or 3x Plug Power .