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12 Short Squeeze Candidates To Watch

April 17, 2020 2:07 pm
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12 Short Squeeze Candidates To Watch

One of the most powerful tradable market events is a short squeeze, so traders are always on the lookout for the next short squeeze candidate. S3 Partners analyst Ihor Dusaniwsky has just released a list of potential short squeeze stocks based on their high borrow rates.

A stock borrow fee is the percentage of a stock’s value that brokers charge short sellers to borrow the stock. If supply of shares to borrow gets low, borrow fees tend to rise.

“The stocks most susceptible to short squeezes are those with high stock borrow costs and large mark-to-market losses,” Dusaniwsky said.

When a stock’s borrow fees spike, it applies pressure to short sellers to choose between closing out their positions or letting fees eat into any potential gains.

Short Squeeze Candidates

Here’s a look at the 12 stocks with at least $50 million in short interest that have endured the largest short seller mark-to-market losses over the past two weeks, according to S3 Partners. Two-week losses are included for each stock:

  • Mallinckrodt PLC (NYSE:MNK), -75.8%
  • GameStop Corp. (NYSE:GME), -69.9%
  • Paysign Inc (NASDAQ:PAYS), -37.5%
  • Ballard Power Systems Inc (NASDAQ:BLDP), -31.2%
  • Virgin Galactic Holdings Inc (NYSE:SPCE), -30.8%
  • Novavax, Inc. (NASDAQ:NVAX), -28.3%
  • Revolve Group LLC (NYSE:RVLV), -27.1%
  • GTT Communications Inc (NYSE:GTT), -20.5%
  • Aphria Inc (NYSE:APHA), -20.1%
  • Accelerate Diagnostics Inc (NASDAQ:AXDX), -18.8%
  • Inmode Ltd (NASDAQ:INMD), -15.8%
  • Clovis Oncology Inc (NASDAQ:CLVS), -14%

Benzinga’s Take

Short squeezes are extremely unpredictable, and a rise in short seller losses is not a definitive indication that a squeeze is coming. However, the combination of high short interest and rising short seller losses makes these 12 stocks worthy of being at the top of any short squeeze watch list.

Do you agree with this take? Email feedback@benzinga.com with your thoughts.

Related Links:

10 Short Squeeze Candidates If The Market Rally Continues

Luckin Coffee Short Sellers Make $1.1B In Profits As Shares Continue Plummet

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