Short squeezes have been among the most popular and controversial topics on Wall Street in the past couple of years. In 2021, groups of online stock traders on Reddit made headlines by orchestrating targeted buying campaigns to trigger short squeezes in some of the market’s most heavily shorted stocks. A short squeeze is a large, short-term spike in a stock’s share price that occurs when a significant number of short sellers are forced to buy shares and exit their positions all at once.
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Here are nine stocks primed for the next big short squeezes, according to Ortex Analytics:
| Stock | Short interest as of Nov. 1 | Cost to borrow* |
| Sientra Inc. (ticker: SIEN) | 17% | 62.3% |
| Fisker Inc. (FSR) | 45.7% | 42.4% |
| Lion Electric Co. (LEV) | 19% | 26.8% |
| Sirius XM Holdings Inc. (SIRI) | 28.4% | 32.4% |
| Beyond Meat Inc. (BYND) | 41.2% | 35.6% |
| Cipher Mining Inc. (CIFR) | 31.2% | 28.1% |
| Bowlero Corp. (BOWL) | 75.4% | 20.7% |
| Prime Medicine Inc. (PRME) | 22.1% | 12.8% |
| MicroVision Inc. (MVIS) | 25.6% | 12.1% |
*A high borrowing cost is an indicator of high short-seller demand.
Sientra Inc. (SIEN)
Sientra is a medical aesthetics company based in Irvine, California. The company’s product portfolio includes its breast implants, its AlloX2 breast tissue expander and its enhanced viability fat transfer system. The company went public in 2014, and short sellers are banking on its horrible performance to continue. The stock’s IPO price was $15 per share, but the stock closed at 85 cents — even after completing a 1 for 10 reverse stock split in January 2023. Sientra has a minuscule float, or number of publicly traded shares not held by company insiders, of just 10.3 million shares, making it a potentially extremely volatile short squeeze candidate. The stock’s short interest is up to 17% of its float.
Fisker Inc. (FSR)
Fisker is one of many electric vehicle stocks short sellers have successfully targeted in recent years. Fisker went public via a special-purpose acquisition company, or SPAC, merger in October 2020 at a price of about $9. After trading as high as $31.96 during the peak of the Reddit trading craze in early 2021, Fisker shares have dropped back down to close at $4.33 on Nov. 1. The stock took a hit in December 2022 after short seller Fuzzy Panda Research said Fisker was facing liquidity issues, claims Fisker subsequently denied. Fisker’s short interest is up to 45.7% of its float, making it a prime squeeze candidate.
Lion Electric Co. (LEV)
Lion Electric produces commercial electric vehicles. In July, the company opened a new manufacturing facility in Illinois to produce electric school buses, but it plans to expand production to other types of commercial vehicles over time. Lion went public via a SPAC merger in May 2021. Its stock initially opened at around $18.50 following the merger, but it has since dropped down to $1.53 as of Nov. 1. If Lion can scale up its production and deliveries, investors could see a major short squeeze. Ortex estimates about 19% of Lion’s float is held in short positions.
Sirius XM Holdings Inc. (SIRI)
Sirius XM Holdings is a leading provider of satellite and internet radio services, largely for the auto industry. In September, Liberty Media Corp. proposed a deal to merge its Sirius XM tracking stock group (LSXMA, LSXMB, LSXMK) with Sirius XM Holdings. Liberty already owns an 83% stake in Sirius XM, and the deal would form a new consolidated entity. SIRI stock initially dropped following the complicated proposal, and short sellers are certainly unconvinced. Sirius XM reported flat revenue growth and minimal net income growth in the second quarter, but an auto market rebound could ignite a short squeeze. Sirius XM’s short interest is 28.4% of its float.
[See: Artificial Intelligence Stocks: The 10 Best AI Companies.]
Beyond Meat Inc. (BYND)
Plant-based meat company Beyond Meat has had a disastrous couple of years, and 2023 is no exception. Beyond reported a 30.5% year-over-year drop in revenue in the second quarter — its fourth consecutive quarter of double-digit sales declines. The stock is down 96% in the past three years, and short sellers smell blood in the water. Beyond Meat investors were once betting on a growth stock with a massive addressable market, but short sellers see an unprofitable company with negative growth in an increasingly competitive market. Beyond Meat’s short interest stands at 41.2% of its float.
Cipher Mining Inc. (CIFR)
Cipher Mining operates a Bitcoin (BTC) mining business. Bitcoin prices are up 109% so far in 2023, so it’s easy to understand why Cipher shares are skyrocketing. However, short sellers likely see the stock’s incredible 524% year-to-date gain as overkill and are betting on a significant pullback. Cipher reported a $12.7 million net loss in the second quarter, and the stock trades at a steep valuation of 15.5 times sales. However, another significant rise in Bitcoin prices could send short sellers running for the hills. Cipher’s short interest is 31.2% of its float.
Bowlero Corp. (BOWL)
Bowlero owns and operates bowling centers. Bowlero went public via a SPAC merger in December 2021. The stock closed at $9.56 on its first day of trading and has since held up relatively well compared to other SPAC stocks targeted by short sellers. Bowlero closed at $9.63 on Nov. 1. The company reported a 10.6% year-over-year drop in revenue in its fiscal fourth quarter, but Bowlero’s revenue was still up 54% on a two-year basis. Ortex estimates 75.4% of Bowlero’s float is held in short positions, suggesting potential for an explosive short squeeze at some point.
Prime Medicine Inc. (PRME)
Prime Medicine is one of the few companies that went public in a difficult market in 2022. Prime Medicine is developing its gene-editing technology, Prime Editing, to treat a wide range of genetic diseases. Earlier this year, Prime nominated PM359 as its first development candidate for treating chronic granulomatous disease. It also reported data demonstrating the potential of its PASSIGE platform to produce multiplex-edited CAR-T cells, suggesting Prime Editing could be used to treat cancers and immune diseases. Short sellers are seemingly skeptical about the company’s technology. Prime Medicine’s short interest is 22.1% of its float.
MicroVision Inc. (MVIS)
MicroVision is developing a lidar sensor used by autonomous vehicles to interpret their surroundings and has been a favorite of Reddit community WallStreetBets since early 2021. After trading as high as $28 during the peak of the Reddit trading craze in April 2021, MicroVision shares have dropped back down to close at $1.87 on Nov. 1. Earlier this year, MicroVision demonstrated its short squeeze potential, soaring from under $2 to as high as $8.20 in less than six weeks. Short sellers see the company reported less than $1 million in revenue and a $20.6 million net loss in the second quarter. The stock’s short interest is up to 25.6% of its float.
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9 Short Squeeze Stocks That Could Take Off in November originally appeared on usnews.com
Update 11/02/23: This story was previously published at an earlier date and has been updated with new information.
