In 2021, short selling has received a lot of attention. Throughout the year, the retail traders on social media platforms have successfully coordinated buying activities for heavily shorted stocks to trigger short squeezes.
Short squeezes are sudden stock price surges that happen when a significant number of short-sellers are compelled to cover their positions by buying back shares. Here’s the list of heavily shorted stocks that have short squeeze potential.
Lightning eMotors (ZEV) stock is primed for a short squeeze as 34.7 percent of its float is sold short. The borrow fee rate also increased to 76.8 percent from 62 percent last week. The company designs and manufactures an electric fleet of medium and heavy-duty vehicles, including shuttle buses and delivery trucks. Lightning eMotors announced an $850 million EV deal with Berkshire Hathaway’s Forest River. In August, D.A. Davidson initiated coverage on ZEV stock with a buy recommendation and a target price of $17, which is 83 percent above its current price.
Support.com (SPRT) could be another short squeeze candidate as 66.5 percent of its float is sold short. The borrow fee rate is down significantly at 81.4 percent from last week’s 102 percent. There's still a lot of enthusiasm for the stock on social media platforms. Support.com has scheduled a shareholder vote on Sept. 10 to approve a reverse merger deal with a Bitcoin mining firm Greenidge Generation.
ATIF Holdings (ATIF) stock has a short interest ratio of 26.6 percent and a borrow fee rate of 51.8 percent. ATIF is in the top five for the first time this week. The company offers financial planning and investment advisory services to Chinese companies wanting to go public.
Big 5 Sporting Goods
Big 5 Sporting Goods (BGFV) is a California-based sporting goods retailer. BGFV stock is up more than 450 percent over the last year, and the short-sellers have piled in. The same-store sales for the second quarter of 2021 were up 33.4 percent versus the second quarter of 2019, which indicates that the firm has now far exceeded its pre-pandemic levels. BGFV stock is an excellent short squeeze target as 72 percent of its float is sold short.
Vinco Ventures (BBIG) has nearly 28.8 percent of its float shorted. The borrow fee rate increased to 80 percent from last week’s 62 percent. Recently, Vinco Ventures has become associated with the NFT sphere, which is rapidly gaining popularity. This exposes the firm to the Ethereum blockchain.
Clover Health (CLOV) is one of the most popular tickers among retail traders on social media platforms and remains a potential short squeeze candidate. CLOV stock has nearly 15 percent of its float shorted. The stock is about 60 percent below the peak of early June. Clover Health operates as a next-generation Medicare Advantage insurer. In the second quarter, the company’s revenues grew by 140 percent YoY to $418 million.
AMC Entertainment (AMC) has a short interest ratio of 18 percent—a number that could be high enough to trigger a squeeze. In January, AMC stock did squeeze short-sellers, shortly after the movie theater chain saved itself from bankruptcy by selling shares and issuing high-interest debt.