GameStop (GME) has become a top-of-mind name on Wall Street in 2021 in the most improbable of ways.
The brick-and-mortar video game retailer was among the markets most heavily shorted stocks to start the year – but a group of investors, sparked by the Reddit community r/WallStreetBets, sparked a campaign to purchase shares. The primary reasoning was that a sudden spurt of buying could trigger a short squeeze of people who betting against the company, driving GameStops shares even higher.
We think the bulk of ... gains was driven by a short squeeze and very little has changed in GMEs fundamental story, says CFRA analyst Camilla Yanushevsky, who rates the stock a Sell.
GME shares had gained 1,740% between the start of the year and Jan. 27 before hitting a severe patch of volatility. At the height of the video game retailers short interest, roughly 140% of its float (shares available for public trading) was being used to bet against the stock.
Many short squeezes end the same way: Buyers lock in their gains, and the stock settles back to earth. However, several heavily shorted stocks currently boast real fundamental bull cases for longer-term buyers. Some havent yet been caught up in a short squeeze, so they could benefit from one as soon as enough investors realize the improvements theyve been making. Others have already been squeezed higher and could dip once short-term traders tire, providing a better entry point for buy-and-hold investors.
Here, we look at 10 of the top shorted stocks that are worth a much more serious look. In each case, short interest accounts for at least 10% of the float – a high number that points to a greater likelihood of a short squeeze. Well explain why each stock here could be more than just the flavor of the week.
- SEE MORE The 21 Best Stocks to Buy for 2021
Data is as of Jan. 31. Short interest data provided by S&P Global Market Intelligence. Stocks listed in reverse order of shares sold short as a percentage of the float.
Find us at the office
Blotner- Kwas street no. 55, 39246 Canberra, Australia
Give us a ring
+78 715 483 676
Mon - Fri, 10:00-22:00