Plug Power inc. (NASDAQ:PLUG) shares are trading higher Thursday. The U.S. Senate extended a critical hydrogen production tax credit, providing a significant boost to the clean energy sector on Monday.
What To Know: According to Barron's, a revised version of the Senate's budget bill extended the construction start deadline for the Section 45V hydrogen tax credit to Dec. 31 2027. The deadline was previously set for Jan.1 2026 and its extension offers a lifeline to many hydrogen projects that were facing potential cancellation.
The credit provides up to $3 per kilogram for clean hydrogen production, a key incentive for companies like Plug Power that are working to build out hydrogen infrastructure. The unexpected two-year extension could drive new investments and restore momentum in a sector that had been weighed down by policy uncertainty. Just weeks ago, Plug Power's stock had been under pressure due to concerns that these credits could be phased out sooner under a Senate Finance Committee proposal. That concern had triggered multiple analyst downgrades and price target cuts across Wall Street.
While the stock had already started to rebound last week following company participation in investor events, Monday's policy development marks a more material shift.
Despite the positive catalyst, Plug Power still faces a skeptical analyst community. Several firms have recently cut their price targets sharply, even while maintaining formal Hold or Underweight ratings. Jefferies trimmed its target to 90 cents, while Morgan Stanley and Piper Sandler lowered theirs to 50 and 80 cents, respectively. Wells Fargo also moved its target down to $1.
The stock is still down significantly from its 52-week high of $3.34 but has recovered from its 69-cent low as investors reassess the company's prospects in light of the new policy development.
PLUG Price Action: Plug Power shares were up 5.36% at $1.475 at the time of writing, according to Benzinga Pro.
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