Plug Power Up on Morgan Stanley Upgrade, Deals for Clean Fuel By

© Reuters

By Dhirendra Tripathi – Plug Power stock (NASDAQ:) climbed 11% Wednesday after an upgrade by Morgan Stanley (NYSE:) and green hydrogen deals the company struck with Airbus (PA:) and Phillips 66 (NYSE:).

Morgan Stanley analyst Stephen Byrd upgraded the stock to overweight with a revised target of $40, an upside of around 21% from the stock’s current level.

Byrd sees positive risk-reward from current levels with three catalysts driving the stock’s outperformance.

The company has announced several strategic partnerships recently, a development the analyst is enthused by. He also pointed out to around $4 billion of cash and cash equivalents on its balance sheet, accelerating revenue growth and the potential for significant upside from legislative support as other reasons for his optimism in the stock.

According to the analyst, green hydrogen will play a crucial role in decarbonization, and he believes Plug Power is one of the best positioned to benefit from future demand for the fuel and related technologies given its vertical integration strategy, scale, and expertise.

Incidentally, the company announced two more deals today to further the use of green hydrogen.

The deal with Airbus aims to decarbonize air travel and airport operations with green hydrogen. Under this pact, the two companies will select a U.S. airport to serve as the first ‘hydrogen hub’ pilot airport in North America, serving as a case study for hydrogen infrastructure scale-up at other airports.

Plug Power and Airbus will also consider setting up a range of joint projects as part of this partnership to further pioneer the deployment of green hydrogen infrastructure for aviation, at scale.

The agreement with Phillips 66 will explore ways to deploy Plug Power’s technology within the former’s refineries and other operations.