Short Report: Spike in bearish bets on Lovesac pays off

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 down 0.4%, the Nasdaq Composite was up 1.0%, the Russell 2000 index was down 1.5%, the Russell 2000 Growth ETF (IWO) was down 1.8%, and the Russell 2000 Value ETF (IWN) was down 1.0% in the five-day trading session range through December 12.

SHORT INTEREST GAINERS –

• Ortex-reported short interest on MGP Ingredients (MGPI) troughed at a nine-month low of around 22% for much of last week before gaining five percentage points above 27% – the highest level since mid-November. Days to cover on the name slipped, however, in spite of subdued trading volume and reduced volatility since the company’s disappointing Q3 pre-announcement in mid-October, falling to 6.7 from 7.3. MGP Ingredients shares are now down 54% year-to-date, though in the five-day period covered, the stock traded up about 1%.
• Estimated short interest on HighPeak Energy (HPK) has been on the rise for the past four weeks, ever since a Q3 earnings beat on November 4 drove an 11% jump in the stock price and briefly spooked bears into reducing exposure to two-month lows. This week, short positioning as a percentage of free float was up from 29% to about 33% – within a percentage point from this year’s high seen in the last week of September. The stock is down 3% in the five-day period covered but trades flat for the year.
• Ortex-reported short interest in Guess (GES) was up from 27.7% last Thursday to as high as 33% – a six-week high – before finishing the week at 31.1%. Likewise, days-to-cover rose from 13.0 to record-high of 18 before ending Thursday at 16.2. The trend in the stock has been decidedly negative since mid-October, though the downward bias accelerated following the company’s disappointing Q3 and below-consensus Q4 guidance two weeks ago. Shares are down 11.5% since Guess reported results, also falling 7.5% in the five-period covered. Friday’s low of $14.95 marked the lowest level since September of 2022.
• Estimated short interest on Apogee Therapeutics (APGE) had tracked sideways in a 23%-25% range since early October against a more volatile stock price action, with shares topping $60 in early November and then falling below $45 just two weeks later. This week, however, even as Apogee tested a four-month low below $42, short positioning as a percentage of free float started to pick up, rising about three points to 27%. The stock was down 6% in the five-day period covered, though thanks to its sharp burst in early March following APG777 data, Apogee is still up 59% year-to-date.
• Ortex-reported short interest on Beyond Meat (BYND) was up over four percentage points from 42.9% to 47.2% this week – now within just two points of a multi-year high around 49% seen in mid-September. Bears are in trend-following mode, with the stock first falling 11% the day after earnings on November 6 and then a steadier slide over the past two weeks. In the past ten trading sessions, Beyond Meat has fallen 23% – with Friday’s low also being its multi-year low. In the five-day period covered meanwhile, the stock was off by 13%.

SHORT INTEREST DECLINERS –

• Bears had loaded up on Lovesac (LOVE) heading into the company’s Q3 earnings this week, boosting their exposure over the previous two weeks from 30.5% to about 34.5%, according to Ortex data, and Lovesac’s larger than expected Q3 loss and a substantial earnings guidance cut for FY25 have obliged. The stock was down 32% the day after the results, also falling 30% in the five-day period covered. Shorts are now moving on, with bearish exposure as a percentage of free float sliding from 34.6% to 29.3% – a two-month low. Likewise, despite this week’s trading volume spike, days-to-cover on Lovesac was down from 14.0 to 11.6 – the lowest level since late September.