One of the outstanding events on the stock exchange this year was
Plug in the power supply,
A pioneer in providing clean energy for forklift trucks and other traditional gas hogs. The stock (ticker: PLUG) increased six-fold in 2020, hitting $ 25 per share last week when the company announced a nearly $ 1 billion stock offering.
The craze for Plug is part of the welcome willingness of investors to invest money in the physics of green energy for global warming, including electric vehicles, hydrogen, and the fuel cells made by Plug. The fuel cells are plug compatible with existing forklifts, making them easier to use
(AMZN) – the customers who accounted for two-thirds in 2018 and half of Plug’s sales in 2018. Part of the attractiveness of Plug for investors is certainly due to the sight of these two big names enjoying the benefits of Plug Power’s environmentally friendly products.
Amazon and Walmart once again benefited from plug’s patronage. They got paid to buy their products. In 2017, the fuel cell maker offered them warrants for its stock in exchange for $ 50 million in purchases. The appreciation of Plug Power’s shares has enabled these satisfied customers to generate profits well above what they spent on Plug Power’s goods.
These sales incentives are properly stated in the footnotes to Plug Power’s securities registrations. We asked Amazon and Plug to discuss it, but they declined. Amazon referred us to Plug, and Plug cited the quiet time around its stock offering.
Amazon was a better customer than Walmart. Plug’s filing for the September 2020 quarter shows that the e-commerce giant is in its third installment of $ 50 million. The exercise price for the 14.55 million shares that Amazon earned from the first two tranches was $ 1.19.
At $ 17 million and purchasing $ 100 million in plug goods and services, Amazon could now hold more than $ 350 million in plug stock. For the third order tranche, the warrant price was set back to approximately $ 13 per share. With stock trading above $ 24 today, the incentive of the loyalty program remains strong.
“It’s very positive indeed,” said Andrew Marsh, CEO of Plug, when asked about the warrant deals for the company’s November 9 earnings call. Certainly – for Amazon, which has found a quick way to benefit from the green energy revolution.
Write to Bill Alpert at [email protected]