Potential short squeeze plays gained steam in 2021, with new retail traders looking for the next huge move.
A short squeeze can occur when a heavily shorted stock rises in value instead of falling. Short sellers could be looking to close out their position and can face a loss if they have to buy back the shares they initially borrowed at a higher price.
A squeeze can occur when short sellers are forced into buying to cover their position, which can cause shares to move up higher on many occasions.
Fintel Data: Data from Fintel, which requires a subscription, provides a look at several of the top shorted stocks and data on how likely a short squeeze is to occur.
Here’s a look at Fintel’s top five short squeeze candidates for the week of June 13.
TherapeuticsMD: Drug development company TherapeuticsMD TXMD moves up from second place last week to top the leaderboard. The company, which has a focus on developing products targeting women, has 24.2% of its float short, up from 17.7% in last week’s report. The cost to borrow on shares is 74.1%, down slightly from last week’s 75.9%.
Eliem Therapeutics: Biotechnology company Eliem Therapeutics ELYM ranks second for the week, moving up 13 positions into the top five. Fintel data shows 36% of the company’s float short. The cost to borrow on shares is 16.5%.
Joann Inc: Arts and crafts retailer Joann Inc JOAN joins the short squeeze leaderboard, moving up 15 positions to rank third for the week. Fintel data shows 33% of the company’s float short and a cost to borrow of 80.8%, among the highest on the leaderboard.
Beam Global: Cleantech company Beam Global BEEM rejoins the leaderboard, moving up to fourth place. Fintel data shows 26.5% of the company’s float short and a cost to borrow of 42.3%. The company sells products for electric vehicle charging infrastructure and has previously appeared on the short squeeze leaderboard.
Insignia Systems: Advertising company Insignia Systems ISIG is among the biggest gainers on the leaderboard for the week, moving up 619 positions to fifth place. Fintel data shows 11.4% of the company’s float short and a cost to borrow of 97.5%.
Other Stocks To Watch: Outside of the top five stocks on the short squeeze leaderboard, two other companies jump out that could join the top five next week.
Chicken Soup for the Soul Entertainment CSSE ranks sixth with 24.9% of the float short and a cost to borrow of 8%. The sixth place ranking comes as the media company is set to acquire Redbox Entertainment RDBX, another popular short squeeze candidate. Investors could be pushing shares of Chicken Soup for the Soul higher to increase the buyout price of Redbox, which is being done in CSSE shares.
BigBear.ai Inc BBAI, which has ranked in the top five previously, ranked seventh for the week. Fintel data shows 24.2% of the float short. The key number to watch is a high cost to borrow of 733.8%, one of the highest on record. The stock moved up 98 positions to seventh place and could be among the top five stocks in next week’s report.
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.