Plug Power Stock Surges 34% in Massive Volume Rally
A potent mix of positive catalysts and high short interest sends the hydrogen fuel cell company's shares soaring.
Shares of Plug Power (PLUG) skyrocketed Tuesday, closing up 34.28% in a dramatic session that saw trading volume swell to nearly 500 million shares. While no single press release appeared to trigger the move, the rally is being attributed to a powerful combination of recent positive developments and a significant level of short interest in the stock, potentially fueling a short squeeze.
The hydrogen fuel cell maker has been the subject of several pieces of good news recently, creating a strong foundation for the rally. A key catalyst appears to be a vote of confidence from Wall Street, with , signaling renewed optimism in the company's growth trajectory.
Further bolstering investor sentiment is substantial government backing for the green hydrogen sector. Plug Power recently to develop up to six hydrogen production facilities. This, combined with incentives like the 45V tax credit under the Inflation Reduction Act, has provided a significant financial tailwind for the company.
Operationally, the company has also demonstrated progress, including the successful delivery of a large electrolyzer array for a green hydrogen project in Portugal. This execution on major projects helps validate the company's technology and business model.
However, the technical setup of the stock is a critical piece of the puzzle. A high percentage of the company's shares were sold short, meaning a large number of investors were betting the price would fall. The recent wave of positive news likely forced many of these short-sellers to buy back shares to cover their positions, a phenomenon known as a "short squeeze," which can dramatically amplify a stock's upward movement. Despite the recent surge, , with profitability not expected for several years, ensuring that Plug Power will remain a closely watched battleground stock.