Plug Power (NASDAQ:PLUG) stock has staged a strong comeback despite the elevated short interest. After bottoming at $0.688 in May last year, the hydrogen power company has soared by 475% to $3.95. It has jumped by 65% this year, outperforming the S&P 500 Index, which has jumped by 9.15% this year. 

Plug Power Stock Has Jumped After Encouraging Earnings

PUG stock has staged a strong comeback after crashing to a record low last year. This rebound continued this year after the company published two encouraging financial results that demonstrated its business was making a slow recovery.

In March, the company said that its fourth-quarter revenue rose to $194 million, beating the average estimate of $190 million. The improvements continued in the first quarter as its revenue rose by 23% to $163 million, helped by more orders from Amazon (NASDAQ:AMZN) and Walmart (NASDAQ:WMT).

Plug Power also excited investors by noting that it had over $8 billion in project pipeline across the industrial and materials business. Some of its existing projects are in Portugal and Spain. It expects to win a major deal to supply electrolyzers at the Barrow Green Hydrogen project in the UK.

Wall Street analysts expect that the company's business will continue doing well this year. The average estimate is that its annual revenue will jump by 14.5% this year to $813 million. It will then jump by 19% to $964 million.

This growth is a major turnaround for a company that was on the verge of collapse a few years ago. To stay afloat, Plug Power has had to dilute its shareholders aggressively, with its outstanding shares rising to 1.39 billion from below 600 million in 2021.

Still, the company faces a major risk, which explains why its short interest has jumped to 27.5% or 340 million shares. One of the risks is that the company may need to raise more cash using its at-the-market (ATM) offering. 

It ended the last quarter with $802 million in total cash, including $223 million in unrestricted cash and $579 million in restricted one. The latter will release at least $50 million per quarter in the next few years. 

PLUG Stock Has Formed Bullish Technicals

The daily chart shows that the PLUG share price has rebounded in the past few months. It formed a double-bottom pattern at $1.70 and a neckline at $2.65, its highest point in January this year. A double-bottom is a common bullish reversal sign in technical analysis. 

There are signs that the stock is now forming a cup-and-handle pattern whose upper side is at $4.57, its highest point last year. If this is accurate, it means that the stock will keep rising in the coming days or weeks. The initial target is the upper side of the cup at $4.57. 

This cup has a depth of about 63%. Measuring the same distance from its upper side gives it a target of $7.50, up by 90% from the current level. 

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