Forklift power supplier Plug Power soars after Amazon grocery deal

Shares of hydrogen fuel cell maker Plug Power (PLUG) are soaring today after e-commerce giant Amazon (AMZN) announced earlier that it will acquire organic food retailer Whole Foods Market (WFM). AGREEMENT WITH AMAZON: In early April, Plug Power entered into a pact with Amazon to supply hydrogen fuel cells to power forklifts in 11 Amazon warehouses. Additionally, Amazon at the time, secured the right to buy up 23% of Plug Power. At the time, the companies said that Amazon and Plug Power will begin working together on technology collaboration, exploring the expansion of applications for Plug Power's line of ProGen fuel cell engines. Plug Power also had granted Amazon warrants to acquire up to 55,286,696 of Plug Power's common shares at $1.1893 per share. In an exclusive interview with The Fly, Plug Power CEO Andy Marsh discussed the company's agreement with Amazon, stating: "We really started working with Amazon back in April and we did our first deployment with them in the fourth quarter. In that deployment, we were able to demonstrate our speed by having the system up in eight weeks and they saw the advantages of using fuel cells in their distribution centers." ANALYST INPUT: On May 10, FBR Capital analyst Carter Driscoll said he believes Plug Power's "weak" Q1 results provided a buying opportunity. Walmart (WMT) negotiations drove the weaker than expected results, but the Amazon agreement should drive core material handling sales and improve revenue visibility, Driscoll told investors in May. He said he expected a resolution to the Walmart PPA profitability issue no later than Q3. The analyst maintained an Outperform rating on Plug Power with a $3 price target. PRICE ACTION: Shares of Plug Power are up over 9% to $2.24 per share in late day trading.