Plug Power (NASDAQ:PLUG), the hydrogen fuel cell company, was somehow able to raise more than $3.4 billion in two different tranches in January and February 2021. The company sold $1.6 billion of PLUG stock at $29.29 in February to a subsidiary of SK Holdings, the third-largest conglomerate in South Korea.

Additionally, it managed to do a secondary offering on the Nasdaq Exchange for $1.8 billion at $65 in January and February. The problem is the stock is now at $27.06 as of midday Sept. 28. This means both these tranches of investors have nothing to show for their investment in Plug Power.

I wrote on March 15 that PLUG stock was very overvalued at 38 times forward earnings when it was trading at $46.46. Since then the stock has cratered more than 41.7% from that price. With the company’s continuing losses, and more importantly its negative free cash flow, the stock will likely keep falling.

Where Things Stand for Plug Power

On Aug. 5, Plug Power released its second-quarter results, showing huge gains in revenue but also massive losses. Its revenue rose 83% from $68 million last year to $124.6 million in Q2 2021. Moreover, its gross billings gained 74.4% from $72.4 million to $126.3 million in Q2 2021.

But the problem is that losses skyrocketed to $89.6 million on an operating basis from $26.5 million last year. In addition, net income was negative $99.6 million compared to $9.4 million a year ago.

But more importantly, its free cash flow (FCF) losses skyrocketed. For example, for the six months ending June 30, the company burnt through $246.6 million on an operating basis. This can be seen on page 15 of its shareholder letter in the Statement of Cash Flows.

Moreover, after deducting capex spending of $33 million and $7.6 million in other equipment purchases, it FCF loss was $287.5 million for the 6 month period.

That implies its annualized cash burn rate was at least $575 million. It could go even higher as sales rise since Plug Power seems to spend more on operating losses and capex with higher sales. This could easily begin to put a dent in its cash balance of $3.24 billion over several years.

What Plug Power Is Worth

Despite the higher sales and all the green projects the company is starting for fuel cell power plants around the world, the stock still seems to be too high. It reflects lots of good news that may not happen for a long time.

For example, 21 analysts surveyed by Seeking Alpha have an average revenue estimate of $494 million for 2021. Since PLUG stock has a market capitalization of $15.5 billion, this means its price-to-sales (P/S) multiple is a whopping 31.4 times sales. That ratio would be high even if it was a price-to-earnings (P/E) metric.

Moreover, for 2022, these same analysts forecast sales of $753.2 million. Granted, while that represents a potential growth rate of more than 52% by 2022, the P/S multiple is still very high. It works out to over 20.6 times forward revenue. That is also a high metric, even if it was a P/E ratio.

The point is that PLUG stock is likely to fall at least another 50%, bringing its forward P/S multiple to just 10 times. That implies that the stock price is worth just $13.53 per share.

What to Do With PLUG Stock

Analysts on Wall Street don’t agree with me. For example, 15 analysts surveyed by TipRanks.com have an average price target of $41.14, or 53% higher. Yahoo! Finance, which uses Refinitiv data, reports that 23 analysts have an average target of $43.06. Seeking Alpha says that 24 analysts have an average target of $40.55 per share.

The problem is that these same analysts have been 100% wrong since March when the company raised its capital. Just as I suggested, PLUG stock has fallen, not risen. So why should you believe these analysts now? The stock is still very overvalued, especially since it is nowhere near making profits anytime soon.

Therefore, most value investors will likely stay away from PLUG stock, at least until there is some bargain element or profitability. So far, I see none of these.

On the date of publication, Mark R. Hake did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Mark Hake writes about personal finance on mrhake.medium.com and runs the Total Yield Value Guide which you can review here.