RBC Capital Markets initiated coverage of Plug Power on Wednesday, saying the stock provides exposure to a growing hydrogen industry that could be key to reducing carbon emissions. "Hydrogen is increasingly viewed as a key pillar of de-carbonization strategies worldwide. With a lot of investment and government support, we believe a multi-decade hydrogen transition can occur," RBC's Joseph Spak said in a note. Spak noted that the hydrogen economy could bring in more than $2.5 trillion per year in revenue by 2050, according to the Hydrogen Council , a CEO-led initiative of roughly 100 companies around the world. RBC gave Plug Power an outperform rating and set its target price at $42, implying upside of 23% to the stock's closing price of $34.08 on Tuesday. Plug Power leads in the hydrogen fuel cell space with close to 95% market share in fuel cell forklifts, according to RBC. The firm highlighted Plug Power's "pedestal" customers that include big names like Amazon , Walmart , Home Depot and General Motors . "Fuel cell penetration within this market is still in its infancy and can increase as fuel cell forklifts can be competitive with traditional offerings and as customers look for decarbonization efforts," Spak said. Beyond fuel cells, RBC sees Plug Power becoming a "one-stop hydrogen shop" as the company looks to expand vertically into a producer and distributor of hydrogen. Shares of Plug Power are nearly flat in 2021, but are up more than 300% in the past 12 months. — CNBC's Michael Bloom contributed to this report.
Plug Power hydrogen delivery truck.
Source: Plug Power
RBC Capital Markets initiated coverage of Plug Power on Wednesday, saying the stock provides exposure to a growing hydrogen industry that could be key to reducing carbon emissions.