Estimated short interest in Avis Budget and VTEX at multi-week highs; Virgin Galactic short position hits new record.

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Welcome to this week’s installment of “The Short Interest Report" - The Fly's weekly recap of short interest trends among some of the most widely followed high-short-float stocks. Using the data from our partner Ortex.com, which utilizes the latest information from stock lenders to estimate short interest changes for thousands of publicly traded companies, this report will screen for some of biggest changes in short interest as a percentage of free float and days-to-cover ratios while also considering the short interest data on some of the more volatile and heavier-traded names of the week. Based on the availability of data from Ortex, the report tracks the trading period that covers prior Friday through Thursday of this week. As a basis of comparison for stocks discussed below, the S&P 500 index was down 2.1%, the Russell 2000 index was down 1.6%, the Russell 1000 Growth ETF (IWF) was down 1.7%, and the Russell 1000 Value ETF (IWD) was down 2.5% in the period range.

SHORT INTEREST GAINERS

• Bearish appetite for Virgin Galactic (SPCE) has not subsided this week in spite of the company delivering a narrower than expected earnings loss, with estimated short interest in the stock building on last week’s gains. The short position as a percentage of free float rose another four percentage points to 27.4% and now marks the highest level on record. In the same vein, the post-earnings Street research has also been cautious, as analysts harped on its cash burn and long road to profitability. In the five-day period covered, Virgin Galactic shares were flat.
• Rising short interest in VTEX (VTEX) has come up on our screen this week as a new name to monitor amid increasing volatility in short activity over the recent days. The estimated shorts as a percentage of free float troughed in the first week of February just as the stock found some support, spiking from 18% to 41% on February 10th and then rising another seven percentage points to 51% this week, a seven-week high. In the five-day period covered, VTEX shares were down 2.8%.
• Estimated short interest in Avis Budget (CAR) is ticking higher just as the stock looks to reverse some of its post-earnings slump. The company beat on the bottom line earlier this month, but analysts zeroed in on a step-down in buybacks as one of the factors behind the selling. The short position as a percentage of free float on the name has nudged by two percentage points to 19%, a one-month high, and days-to-cover ratio on Avis Budget rose 35% to 5.0. The stock traded up 1.6% in the five-day period covered.

SHORT INTEREST DECLINERS

• ForgeRock (FORG) popped up on this week’s Ortex filter screening for abnormal short activity, with estimated short interest briefly spiking from 19% to 162% last Thursday before coming back down to 24% to finish the week. Days to cover ratio on the name has lifted from 1.8 to 2.7. The company will be reporting earnings this coming Tuesday but otherwise has not seen much in terms of meaningful news. ForgeRock shares were down 9.7% in the five-day period covered.
• Estimated short interest in Sentinel One (S) – another IT security name – has also dipped this week, declining two percentage points to 7.2%, while days-to-cover on the stock slipped by 15 basis points to 0.7. The decline in the stock price during the prior week was accompanied by the gains in short interest to a two-month high of 9%, though the bears now appear to hedge their exposure as geopolitically driven fears of cyber warfare percolate. Sentinel One stock was down 5.2% in the five-day period.
• Estimated short interest in Stitch Fix (SFIX) had hit a multi-month high last week above 26%, but as the stock price worked its way down below the $14 support, the bearish position as a percentage of free float actually receded this week, falling five percentage points to 22%. In turn, days-to-cover on Stitch Fix declined by 15 basis points to 1.41. This growth-oriented name rebounded with the broader market as sentiment turned on Thursday, but the stock was still down 7.1% in the five-day period covered.