Potential short-squeeze plays gained steam in 2021 and continued through 2022, with new 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 on many occasions.
Fintel Data, which requires a subscription, provides a look at several of the top shorted stocks and how likely a short squeeze is to occur.
Here’s a look at the top five short squeeze candidates for the week of Aug. 15.
- ToughBuilt Industries: Home improvement and construction product company ToughBuilt Industries Inc. TBLT tops the short squeeze leaderboard for the fourth straight week. Data shows 51.7% of the float short, up from the previous week’s 34.1% figure. The cost to borrow on shares is 267.8%, down from last week’s 686.8%, but highly elevated.
- U.S. Well Services Inc.: Oil company U.S. Well Services USWS makes a large leap moving up 425 positions on the leaderboard to second place for the week. Data shows 51.4% of the float short and a cost to borrow of 20.4%.
- Singing Machine: Karaoke audio equipment company The Singing Machine Company MICS rejoins the leaderboard, moving up 14 positions to third place. The company previously topped the leaderboard in July. Data shows 26.7% of the float short and a cost to borrow of 108.0%.
- NextNav: GPS service provider NextNav Inc. NN rejoins the top five short squeeze candidates moving up four positions from last week. Data shows 16.6% of the flaot short and a cost to borrow of 22.3%.
- Hour Loop: E-commerce company Hour Loop Inc. HOUR holds steady at fifth place for the second straight week and continues its top five placement for several consecutive weeks. Data shows 17.5% of the company’s float short, down from last week’s 21.1%. The cost to borrow on shares is 57.6%, down from last week’s 59.2% figure.
5 Stocks to Watch
- Ranking sixth for the week is Blue Apron Holdings APRN, which moved up 79 positions. Data shows 44.8% of the float short and a cost to borrow of 25.1%. With the big jump and high short interest, the stock could rank in the top five soon.
- CompoSecure CMPO continues to float around in the top ten and near the top five with a seventh place position, the same as last week. Datta shows 38.8% of the float short and a cost to borrow of 9.1%.
- Chicken Soup for the Soul Entertainment CSSE moved up one position to ninth place. Data shows 15.3% of the float short and a cost to borrow of 340.1%. The company recently completed its acquisition of Redbox, another streaming company and high short interest stock.
- Virgin Orbit Holdings VORB has been in the top ten of Fintel’s short squeeze leaderboard previously and makes its return at 18th place. The stock moved up 19 places, indicating increasing likelihood of a short squeeze. Data shows 11.7% of the float short and a cost to borrow of 105.7%.
- Kidpik Corp. PIK was one of the biggest movers of the week, moving up 368 positions to 23rd place on the leaderboard. Data shows 8.9% of the float short and a cost to borrow of 137.3%.
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