Shares of Plug Power (PLUG 5.36%) soared this week, up 27.6% as of market close on Thursday. The spike comes as the S&P 500 (^GSPC 0.83%) and Nasdaq-100 were up 1.7% and 1.5%, respectively.

Earlier this week, Trump's major budget bill was amended to extend tax incentives for hydrogen power, providing critical relief to Plug Power and other hydrogen stocks. That said, Plug Power is in a tough financial position.

The "Big, Beautiful Bill" is amended

President Trump's "Big, Beautiful Bill," which passed the Senate earlier this week and is likely to soon clear the House, was amended to extend critical tax incentives for the hydrogen industry for two more years. The latest version provides tax relief for hydrogen operators through January 2028, rather than the 2026 end date in previous versions of the bill. This significant change sent Plug Power and hydrogen stocks across the board higher.

Image source: Getty Images.

Plug Power is not in a great position

Investors interested in the company should know that Plug is struggling financially. The company's sales have stagnated and even declined for some time -- with the notable exception of last quarter -- and it is operating at a loss. Its cash burn is not sustainable.

For investors with a high risk tolerance, Plug could be a speculative turnaround play, but I would caution most investors to stay away. Even if the bill passes and the tax credits are extended, Plug is in a very rocky situation.