Yesterday, alternative energy company Plug Power Inc (NASDAQ: PLUG) released its quarterly earnings report for the second quarter of the 2014 fiscal year. The company reported positive earnings due to a gain related to stock warrants.

The company posted a net income of $3.8 million, or $0.02 a share. This is a huge improvement from the second quarter last year in 2013, when Plug Power posted a net loss of $9.3 million, or $0.14 per share.

Sales had increased by more than 100 percent from $7.5 million to $17.3 million during the same quarter one year ago. These results were influenced by an increase of $9.6 million due to the chage in fair value of common stock warrants that were issued previously.

Gross margins increased by 17 percent, and the company announced predictions for its gross margins to hit the mid-20’s by the end of the fourth quarter this year.

Not including the growth, the company saw an adjusted loss of $0.04 per share in the second quarter, which met the expectations of three analysts.

Analysts are now inclined to give Plug Power a Sell rating due to concerns that would make it difficult for investors to gain positive results from investments in the company. Some of the concerns are rooted in the company’s dwindling net income and struggling operating cash flow.

Net Income

The company has seen significant changes in its net income this quarter from the same quarter one year ago. On the basis of this number, Plug Power has severely underperformed compared to the S&P 500 and the industry of electrical equipment. Its net income has fallen sharply by 784.5 percent from the second quarter of 2013, dropping from -$8.58 million to -$75.86 million.

Additionally, the company’s decline in revenue held it back from performing at the average in the industry of 7.5 percent. Since the second quarter from one year ago, Plug Power’s revenue dropped by 13.5 percent.

The company’s struggles with its revenue has had a negative impact on its bottom line as well, and has dragged down Plug Power’s earnings per share. While the last few quarterly earnings reports have shown rather volatile earnings, it is possible that Plug Power’s earnings per share is on track to grow in the upcoming year. In the past year, Plug Power has been losing money – it reported earnings of -$0.79 per share from -$0.94 per share a year earlier. This year, the company forecasts earnings per share to improve to -$0.09 from -$0.74.

Cash Flow

Plug Power’s net operating cash flow has also dropped by 49.83 percent to -$8.89 million from the same quarter one year ago. When comparing that figure to the average in the electrical equipment industry, Plug’s rate of growth is significantly lower.

Source of Strength

The company’s saving grace may be its return on equity, which has significantly grown compared to its return on equity from the same quarter one year earlier. This is a beam of light in an otherwise dark and dejecting report for the alternative energy company. However, compared to other firms in the industry and the market overall, Plug Power’s return on equity is still far behind the industry average as well as that of the S&P 500.

Andy Marsh, Plug Power’s CEO stated that customers are noticing the improvements and the lack of problems with the company’s newer units.

Additionally, analysts are optimistic about Plug’s installation of its GenKey technology for one of Wal-Mart Stores Inc (NYSE: WMT)’s distribution centers, located in Pottstown, Pennsylvania. The installation is expected to help drive Plug Power’s sequential growth throughout this year.

CCG is one of 87 community development entities (CDEs) nationwide receiving an allocation of the total $3.501 billion in New Markets Tax Credits announced by the Treasury Department yesterday. Reflecting the tremendous competition for NMTCs, 310 CDEs had applied for tax credits; only 28 percent of the applicants received funding.

With this newest allocation, CCG has now received five NMTC awards totaling $226 million, which it has used to fund 20 developments in the state. These NMTCs have attracted a total investment of $642 million in these developments. They also have stimulated the creation of 4,400 construction jobs and 3,500 permanent jobs.

“Building vibrant and sustainable communities requires a collaborative effort of the public and private sectors investing in projects that facilitate redevelopment,” said Governor Corbett. “New Markets Tax Credits encourage private involvement. The powerful economic ripple effect we’re creating through engaging the private sector in community development is having a positive impact in our state.”

The goal of CCG is to use these tax credits to fund projects in key areas within communities that have historic or cultural value and offer opportunities to spark economic revitalization.CCG will utilize these newest NMTC’s to provide loans and equity investments for business expansion, mixed-use development, and community facilities across Pennsylvania.

“New Markets Tax Credits allow us to leverage additional private investment in projects that can help turn around struggling communities,” said Brian A. Hudson Sr., chairman of CCG and executive director and CEO of PHFA. “These tax credits have proven to be a powerful tool for promoting economic development.”

Examples of past developments that have benefited from CCG’s investment of these tax credits include Bakery Square inPittsburgh, the Coal Street Community Facility in Wilkes-Barre, and Schmucker Hall in Gettysburg, among others. More information about CCG and the developments it has funded is available on the Web.

The NMTC program, established by Congress in December 2000, permits individual and corporate taxpayers to receive a credit against federal income taxes for making equity investments in vehicles known as community development entities. The credit provided to the investor totals 39 percent of the cost of the investment and is claimed over a seven-year period. For every dollar invested by the federal government, the NMTC program generates more than eight dollars in private investment.