Plug Power stock faces elevated risks as short interest hits 25%

Plug Power stock price has crashed into a bear market in the past few months as concerns about dilution and its growth continued. It has plunged by nearly 50% from its highest point in October, while the short interest has jumped to 25%. So, will this hydrogen company rebound?

Why Plug Power stock has crashed

Plug Power is a top American company focusing on hydrogen power. It creates hydrogen in its plants in New York, Georgia, and Texas. It also sells equipment such as electrolyzers to companies in the utility industry. 

The stock has plunged as concerns about its business accelerated. One major concern is that it has continued to dilute its shareholders, as its business is capital-intensive. 

Just recently, the management announced a new fundraising of $375 million. It raised these funds through convertible senior notes, which it used to pay its outstanding principal amount.

The company’s investors have gone through substantial dilution over the years. For one, data compiled by TradingView shows that the number of common outstanding shares has jumped to 1.2 billion, up sharply from 300 million in 2020.

This dilution happened as its losses accelerated. It made a net loss of over $2.1 billion in 2024, bringing its net loss in the last five years to over $5 billion. 

The most recent results showed that the company made a net loss of over $363 million in the third quarter, up sharply from $211 million in the same period in 2024. Its nine-month loss rose to $788 million from $769 million as the company recorded a $226 million charge in its Project Quantum Leap business.

The losses jumped even as its revenue rose modestly. Its revenue rose to $177 million from $173 million, with most of this growth happening in its power purchase agreements. Revenue of fuel delivered to customers rose to $35 million. This growth was offset by the sharp decline in its equipment sales.

Plug Power stock price has also crashed as more investors have continued to short it. Its short interest has jumped to 25%, meaning that these investors expect the stock to continue falling in the near term. 

Analysts have a mixed opinion on the company. Some analysts anticipate the stock to rebound this year. HC Wainwright’s analysts upgraded the target to $7, up by 253% from the current level. Canaccord Genuity’s George Gianarikas also expects it to rebound to $7.

On the other hand, a Morgan Stanley analyst slashed the target to $1.5, pointing to its dilution.

PLUG stock technical analysis 

The daily timeframe chart shows that the Plug Power share price has pulled back from a high of $4.57 in October to the current $2.2. It has remained above the ascending trendline that connects the lowest swings since May last year. 

The stock also sits slightly above the ultimate support of the Murrey Math Lines tool at $1.56. It is also attempting to move above the 50-day Exponential Moving Average (EMA).

Therefore, the most likely forecast is that the stock rises modestly to the psychological point at $3 and then resumes the downtrend. A move below the ascending trendline will see it retest the ultimate support at $1.56.