Meme-stock maven Roaring Kitty surfaced on social media again to hype GameStop shares. But there are much more lucrative targets beyond the S&P 500.
Ten stocks in the S&P Composite 1500, including SunPower, B. Riley Financial and Arbor Realty Trust, have 30% or more of their shares available for trade in the hands of short sellers, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSurge. That's much higher than the 24% of GameStop's floated shares controlled by short sellers. The S&P 1500 includes the S&P 500 in addition to the S&P SmallCap 600 and S&P Mid Cap 400 indexes.
Stocks with high short interest are ripe for social media market manipulation. Even a small surge of buying and rally in the shares creates rapid losses for short sellers. The only way to stop the losses from getting larger is for the shorts to buy the stock, which lights up even more of a rally.
The meme investors can do much better than GameStop, though.
GameStop Frenzy Returns
Investors got a flashback to the 2020's meme stock phenomenon on Monday. The online influencer known as Roaring Kitty took to X with a cryptic post about GameStop. GameStop's massive short-selling fueled rally put Roaring Kitty on the map.
And just one post is all it took for struggling shares of GameStop to jump more than 74% to 30.46 a share. The rapid rise carries many of the earmarks of a "short squeeze." A short squeeze happens when investors betting a stock will fall rush to close their bearish bets by buying its shares.
But imagine what could happen with more heavily shorted stocks?
The Most Shorted Stocks
There's no debate over the most-shorted S&P 1500 stock based on float. It's industrial SunPower.
More than 94% of the stock's shares available for trade are controlled by shorts. That's considerably higher than at any other stock in the S&P 1500 or S&P 500. And so far this year, the shorts in this stock are having an easy time of things. The solar-power firm's shares are down more than 40% this year on concerns alternative energy subsidies could be at risk due to the U.S. Presidential election.
It's been much more painful for shorts on financial firm B. Riley. Shares are up more than 67% this year. That's a big problem for the short sellers who control more than 57% of the company's shares available for trading. And at another financial firm, Arbor Realty Trust, nearly 40% of shares are shorted. That stock is down nearly 10% this year.
Roaring Kitty's followers might celebrate Monday's win with GameStop. But it will be interesting to see if the meme stock fire moves to stocks with more dry powder.
Most Shorted S&P 1500 Stocks
Based on shares available for trade (float)
| Company | Ticker | Short % of float | Sector |
|---|---|---|---|
| SunPower | 94.0% | Industrials | |
| B. Riley Financial | 57.2 | Financials | |
| Arbor Realty Trust | 40.0 | Financials | |
| Trupanion | 38.1 | Financials | |
| Medical Properties Trust | 37.8 | Real Estate | |
| Vital Energy | 34.4 | Energy | |
| Kohl's | 33.3 | Consumer Discretionary | |
| Medifast | 32.1 | Consumer Staples | |
| Comstock Resources | 30.7 | Energy | |
| Guess? | 30.3 | Consumer Discretionary | |
| GameStop* | 24.0 | Consumer Discretionary |
