Esperion Surge May Be Fueled By Repatha Short Squeeze

Esperion Therapeutics Inc ESPR has maintained its upward momentum on Tuesday, surging higher by another 13.2 percent. While the massive 80 percent runup since January 30 was triggered by positive fundamental news, a major short squeeze may be fueling the stock's enduring momentum.

On February 3, Amgen, Inc. AMGN reported that PCSK9 inhibitor Repatha met both its primary and secondary endpoints in its FOURIER trial to determine if the drug can reduce cardiovascular events in patients with cardiovascular disease. While quantitative data wont' be available until March, Amgen reported Repatha “significantly reduced the risk of cardiovascular events,” news that sent shares of Esperion surging 24 percent.

Short sellers were also likely spooked by several analyst upgrades and bullish comments following the news. Even after the 80 percent gain, JMP Securities still sees more than 100 percent upside for Esperion.

However, the positive development also likely sent short sellers running for the hills ahead of the March data release. According to shortsqueeze.com, Esperion has an elevated short percent of float of 20.3 percent. There are currently more than 2.7 million shares held short with 7.8 days to cover.

Shorts that don’t take the opportunity to cover between now and the official data release are running the risk that the data will send the stock soaring to new highs. With a sizable short position still open, the Repatha short squeeze may continue in the days ahead.