3 Struggling Businesses Investors Shouldn’t Gamble on This Year

The stock market has been picking up steam of late amid hopes of interest rate cuts and a soft landing for the economy in 2024. Should that happen, stocks could be on track for a great year. And investors may be tempted to pick up some struggling ones that may be overdue to rally.

But in some cases, investors may be better off resisting the temptation to take a chance on high-risk investments. Three stocks that crashed by more than 40% last year and that may still be too risky to invest in right now are Plug Power (NASDAQ: PLUG), Moderna (NASDAQ: MRNA), and Lumen Technologies (NYSE: LUMN).

Here’s why you may want to consider staying away from these stocks.

1. Plug Power

Plug Power is a company that investors hope will become a great green energy investment in the future. The company offers hydrogen solutions, but the problem is that, while there may be enticing long-term opportunities from investing in green energy, the business also needs to be around in order to capitalize on them. And that’s by no means a certainty for Plug Power.

The company raised “going concern” issues last year, which means that it is not certain it will be able to survive for another 12 months. The company says supply challenges have created significant risks for its operations, making it probable that it will need to issue more shares and dilute investors in order to keep operating.

Over the past four quarters, the company has incurred operating losses totaling more than $889 million. Its operating cash flow during that time has also been negative $1.2 billion. Meanwhile, the company has cash and short-term investments totaling less than $570 million.

There is no shortage of red flags here to suggest investors stay far away from Plug Power. Even if you think hydrogen may be the long-term solution for energy, that doesn’t mean Plug Power will be around to benefit from that growth. Given the company’s dire financial situation, investors are better off pursuing other growth stocks. Last year,…