Short Report: Carvana, Blue Apron see bearish bets rise

Bears zero in on liquidity-constrained Carvana and Blue Apron, reduce exposure to Groupon

Welcome to this week’s installment of “The Short Interest Report" – The Fly’s weekly recap of short interest trends among some of the most widely followed high-short-float stocks. Using the data from our partner Ortex.com, which utilizes the latest information from stock lenders to estimate short interest changes for thousands of publicly traded companies, this report will screen for some of biggest changes in short interest as a percentage of free float and days-to-cover ratios while also considering the short interest data on some of the more volatile and heavier-traded names of the week. Based on the availability of data from Ortex, the report tracks the trading period that covers prior Friday through Thursday of this week. As a basis of comparison for stocks discussed below, the S&P 500 index was up 6.4%, the Russell 2000 index was up 4.9%, the Russell 1000 Growth ETF (IWF) was up 7.1%, and the Russell 1000 Value ETF (IWD) was up 5.3% in the period range.

SHORT INTEREST GAINERS

• Ortex-reported short interest in Bed Bath and Beyond (BBBY) had hit a seven-week low last week, but the bears returned to the stock this week. Estimated short position as a percentage of free float was up in all five trading sessions, rising from 34.1% to 39.5% overall, with days-to-cover also up 30 basis points to 1.2. Investors also showed no interest in bidding up Bed Bath and Beyond from its lows despite the new management appointments and the broader market surge – in the five-day period covered, the stock was down 3.5%.
• Carvana (CVNA) has continued its slide into the abyss, with the stock now down 95% year-to-date, and the company’s latest earnings report has only produced more losses and even more bearish interest. Estimated shorts as a percentage of free float were up five and a half points to 46.1% this week, a 17-month-high, as Carvana again whiffed on earnings and revenue. Analysts have also maligned the company’s KPIs, with declining retail units, deteriorating gross profit per unit, and expense cuts that are not keeping pace with the rapidly softening markets. The stock was down 30% in the five-day period covered through Thursday, though the stock is certainly a participant in the rally of the past two days, with a 77% jump from Wednesday’s lows.
• Estimated short interest in Blue Apron (APRN) – yet another beaten down name struggling with perceptions of a liquidity crisis – was up five percentage points to 44.2% this week, which is within two points of a three-month high. The company also posted a disappointing Q3 earnings and revenue miss in spite of growing its Average Order Value and Average Revenue per Customer metrics on annual and sequential basis. The stock was down 17.6% in the five-day period covered and caved another 33% on Friday after announcing a $30M equity raise this morning.
• Estimated short interest in Cricut (CRCT) rose two and a half points to 22.9%, matching this year’s high, with days-to-cover on the stock also up 45 basis points to 26.7. Cricut’s Q3 earnings missed this week, but investors cheered the company’s topline beat and growing user base, with a 12% jump the day after results. In the five-day period covered Cricut was also up 21%.

SHORT INTEREST DECLINERS

• Estimated short interest in Groupon (GRPN) was down sharply this week as shares and trading volumes surged after the company’s Q3 results. Groupon missed on earnings, but the management maintained its outlook for 15%-20% sustainable annual adjusted EBITA margins in 2023. Shorts as a percentage of free float for Groupon fell from 49% to 38%, a three-month low. Days to cover on the name were also down nearly 200 basis points at 7.5. The stock was up 41% in the five-day period covered, with another 5% gain heading into the Friday close.

Keywords: Short selling, short interest, days to cover, securities, lending, utilization, sentiment analysis, AMC, GameStop, Bed Bath & Beyond, Carvana, Blue Apron, Cricut, Groupon