A 100% price gain not enough? Nordex, Plug Power, and the dividend gem RE Royalties!

RE Royalties: Will the rally start next week?

While shares of companies like Plug Power, Bloom Energy, and even Nel ASA are skyrocketing, a revaluation for RE Royalties could be on the horizon in the coming weeks. The Canadians are also benefiting from the explosive rise in electricity demand driven by AI. Companies in the energy production and infrastructure sectors are increasingly emerging as the real winners of the AI boom. This is precisely where RE Royalties is positioned. The stock has already shown positive momentum in recent days—possibly just the beginning of a larger rally. After all, based on its business model, the annual dividend of CAD 0.04 (current price CAD 0.40), and growth prospects, the valuation remains attractive.

The current price increase could signal that investors expect exciting news next week. On May 20, 2026, Peter Leighton, COO of RE Royalties, will participate in the IIF virtual investor conference. Management has already expressed its dissatisfaction with the stock price, and various options are currently being explored to address this. These range from partnerships and new financing structures to the sale of the entire company. An update on this is expected next week.

RE Royalties pursues a model that is still little known in Europe but extremely exciting. The company finances renewable energy projects and receives long-term revenue shares in return. This creates a scalable business model with recurring cash flows. Unlike traditional project developers, RE Royalties often bears lower operational risks while still benefiting from the global expansion of clean energy sources. This positioning could become particularly valuable in the age of artificial intelligence. This is because electricity consumption by data centers and AI applications is rising massively—and with it, the demand for green, reliable energy supplies.

The company's portfolio is already impressive. In total, RE Royalties holds stakes in projects with a capacity of 492 MW. These include 77 solar projects, 17 wind farms, 22 storage solutions, two hydropower projects, two efficiency projects, and a biogas plant. The facilities generate enough electricity to power approximately 152,194 households. At the same time, they save more than 488,813 tons of CO₂ annually.

And RE Royalties could continue to grow significantly in the coming years. The company has a potential project pipeline valued at up to CAD 200 million. For context: RE Royalties' market capitalization is under CAD 20 million.

Nordex: Price Target Nearly Doubled, but Stock Too Expensive

The Nordex stock has surged by a fantastic 75% in just 6 months. Over 52 weeks, the gain is as high as 156%. However, this marks the peak for now. At least, that is what Montega believes. In a recent report, the price target for Nordex shares was raised from EUR 22.50 to EUR 44, effectively doubling it. However, the stock is currently trading above EUR 46. Consequently, the rating was downgraded from "Buy" to "Hold." Analysts cite the strong price performance over the past twelve months, as well as potential slowdowns in the German market, as reasons for this. At the same time, competitive pressure remains high, particularly from Chinese turbine manufacturers who are gaining market share internationally. Overall, however, Nordex is still considered significantly more operationally resilient than it was just a few years ago.

Analysts expect Nordex to increase revenue by 13% to EUR 8.54 billion in the current year. Profit is expected to grow at a disproportionately higher rate. EBITDA is projected to climb by 34.9% to EUR 851.3 million, and net profit by as much as 61.6% to EUR 443.6 million. In the coming years, Montega analysts expect Nordex to achieve single-digit revenue growth, reaching EUR 9.39 billion in 2027 and EUR 10.14 billion in 2028. Net profit is projected to reach EUR 625.6 million in 2027 and even decline slightly to EUR 622.7 million in 2028. The growth is therefore impressive across the board, were it not for the valuation, which now stands at around EUR 11 billion.

Plug Power: Is a 100% price gain not enough?

A 100% price gain since late February does not seem to be enough for investors yet. They are driving Plug Power's stock even higher. Hoping that the fuel cell specialist will benefit from the energy boom driven by AI, investors are even celebrating the quarterly figures and pushing the market capitalization to USD 5 billion.

In the first quarter of 2026, Plug Power significantly increased revenue and made progress toward profitability. Revenue climbed 22% year-over-year to USD 163.5 million. Growth was driven in particular by the material handling and electrolyzer segments. At the same time, the gross margin improved noticeably, though it remained negative. After a negative 55% in the same quarter of the previous year, it now stood at negative 13%. The company attributes this development to higher sales volumes, cost reductions, more efficient service processes, and lower hydrogen procurement costs. According to its own statements, Plug Power thus exceeded its internal targets for revenue, margins, and earnings per share.

Although the net loss remained high, it was at least lower than in the previous year. Adjusted earnings per share improved from minus USD 0.17 to minus USD 0.08. However, the quarterly results were weighed down by non-cash items totalling approximately USD 140 million related to convertible bonds and warrants. CEO Jose Luis Crespo nevertheless believes the hydrogen specialist is on track to become profitable on an EBITDA basis (earnings before interest, taxes, depreciation, and amortization) in the fourth quarter of 2026. Plug Power intends to continue focusing on margin improvements, disciplined investments, and the expansion of its integrated hydrogen ecosystem.

At the end of the first quarter of 2026, Plug Power had total cash and cash equivalents of USD 802 million. However, this included only USD 223 million in unrestricted cash, while approximately USD 579 million was reported as restricted cash. It is at least doubtful whether this liquidity will last until Plug Power is profitable after taxes.

The AI rally seems far from over. However, some stocks have really heated up. In contrast, RE Royalties simply seems too cheap. If the stock shifts into rally mode, significantly higher prices should be possible. And the high dividend provides a floor for the price. Plug Power and Nordex have clear momentum, but the stocks have also already performed very well.