Shares of Virgin Galactic (SPCE -1.54%) climbed as much as 10.8% early Wednesday, then settled to trade up 5.6% as of 2 p.m. ET. The move was likely driven by a combination of a new board appointment and bearish investors rushing to close out their positions in highly shorted stocks.

On the former, late yesterday Virgin Galactic announced the appointment of Luigi Brambilla to its board of directors. Brambilla is currently the Managing Director of Investments and Capital Markets at Virgin Group, which he joined in 2013, and serves as a member of the Investment Committee of the Branson Family office.

On short covering, Virgin Galactic's need for capital markets experience

Brambilla's capital markets experience should prove invaluable for Virgin Galactic as the company strives to find a balance between minimizing cash burn and scaling its spaceflight operations. Shares of the leading space economy stock have rallied more than 35% so far this month after the company announced a "strategic realignment" aimed at supporting production of its next-generation Delta spacecraft.

That said, Virgin Galactic is also a favorite target of short-sellers betting against the stock; more than 20% of its total float was sold short as of this morning. The recent rise has almost certainly left many of those short-sellers scrambling to cover their positions, driving the share price of Virgin Galactic higher in the process.

What's next for Virgin Galactic stock?

To be clear -- and noting shares are still down almost 60% over the past year even after the recent rebound -- there are no guarantees these near-term gains will prove sustainable. Even as Virgin Galactic just completed its sixth successful human spaceflight in as many months, its current pace of flights is still nowhere near enough to propel the company to sustained profitability. Virgin Galactic has also clearly told investors the first of its Delta Class spaceships -- which should each be capable of flying once per week -- won't be ready to commence revenue-generating missions until sometime in 2026.

Even so, Virgin Galactic continues to take steps in the right direction to that end. As long as it shows continued progress without any significant hiccups along the way, I'm perfectly content holding my shares.