Short Report: GameStop bearishness recedes further despite stock pullback

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, excluding holidays. As a basis of comparison for stocks discussed below, the S&P 500 index was up 1.5%, the Nasdaq Composite was up 2.9%, the Russell 2000 index was down 0.5%, the Russell 2000 Growth ETF (IWO) was flat, and the Russell 2000 Value ETF (IWN) was down 1.1% in the five-day trading session range through June 13.

SHORT INTEREST GAINERS

• Ortex-reported short interest in Hertz Global (HTZ) jumped from 26.6% to 29.4% over the past week, but while the velocity of the bearish build-up pales next to early May’s spike from 20% to 27%, Hertz shares are now lower by more than 40% since that prior re-positioning. The stock has now fallen 67% year-to-date, yet shorts as a percentage of free float have now hit the highest level of the year. In the five-day period through Thursday of this week, Hertz shares are also down about 10%.
• Ortex-reported short interest in HighPeak Energy (HPK) has been on the rise since the bearish positioning troughed around 15% in the first week of April, though this week saw a particularly steep upswing. Shorts as a percentage of free float on the name jumped from 22% all the way to 29% – the highest level of the year. The momentum also coincides with the exchange-reported data which, as of May-end, has seen five consecutive increases in its semi-monthly reporting periods. With the short positioning on the rise, the stock has been under pressure, slipping 14% from its May-end highs and also declining nearly 3% in the five-day period covered.
• Estimated short interest in Applied Optoelectronics (AAOI) tracked sideways in a 23%-26% range since the start of March, though in the past couple of weeks, bearish appetite is ticking up. Shorts as a percentage of free float gained from 25.9% to 29.2% and days to cover on the name was up from 3.2 to 4.1 as trading volumes thinned. Both of the measures are at the highest point for the year. The stock is bumping up against the floor set on May 10 – just after the company reported worse than expected Q1 earnings and guidance. In the five-day period covered, Applied Optoelectronics was down 2.8% this week, though shares are down 53% from mid-February’s 2024 highs.

SHORT INTEREST DECLINERS

• Ortex-reported short interest in GameStop (GME) has now been reduced to a simmer, even though the volatility and the trading volume this week have hardly matched the high-flying sessions seen late last week. Shorts as a percentage of free float has fallen all the way to 14% from about 20% and has now come in by over ten percentage points from the 25% level seen just before “Roaring Kitty” has resurfaced, with days-to-cover on the stock also declining from 2.1 to 0.9. Shares were up 75% in a two-day rally through Thursday of last week, though this week has seen a retreat of over 37% in the five-session period through Thursday.
• Estimated short interest in C3.ai (AI) is down for the second consecutive week after peaking at a two and a half month high of 34% in late May. Bearish positioning slipped from 31.4% all the way down to 24.8% – a three-month low, while days-to-cover on the name came in from 7.9 to 6.6. Shorts are running to cover after the company’s better than expected Q4 earnings reported on May 29th, along with above-consensus initial revenue guidance for FY25, with the top line growth set to accelerate to 23% this year from 16% growth reported in FY24. The stock has risen 27.5% since reporting those numbers and also advanced about 2% in the five-day period covered.