Shares in Plug Power (PLUG) spiked 19% in Monday’s trading after the company announced a new deal with UK-based supermarket Asda. PLUG will provide the hydrogen fuel cell solutions to power the lift truck fleet within the retail giant’s extensive supply chain network.
Asda’s partnership with Plug Power includes a purchase order agreement for Plug Power’s full-service GenKey solution, beginning at the UK facility in Skelmersdale. The turnkey solution includes fuel cells, hydrogen fueling equipment, hydrogen and service.
“This new customer continues Plug Power’s growth in Europe and represents the first deployment at scale of hydrogen fuel cell technology for material handling within the UK” says PLUG. Indeed, Asda currently ranks as the UK’s third-largest supermarket retailer and is part of Walmart- which itself is a PLUG GenKey customer.
The company adds that the deal will reduce Asda’s reliance on traditional lead acid batteries and is part of a broader initiative to make the company’s operations more environmentally- friendly.
“Each new opportunity to expand the adoption of hydrogen fuel cells is an important step to building the hydrogen economy,” cheered Andy Marsh, CEO of Plug Power.
Shares in Plug Power have enjoyed a stellar run so far this year, and are currently trading up 189% on a year-to-date basis. Plus the stock shows a bullish Strong Buy analyst consensus with a $10 average analyst price target (8% upside potential).
Following the Asda news, HC Wainwright analyst Amit Dayal reiterated his buy rating on the stock and $14 price target (53% upside potential). He commented that PLUG’s hydrogen fuel cell powered forklifts are “quickly becoming the go-to solution” for big box retailers across the US and Europe.
“PLUG [is an] early leader in commercialization of fuel cell mobility applications, where strong momentum is building” commented B Riley’s Christopher Souther recently as he resumed coverage with a buy rating. (See PLUG stock analysis on TipRanks)