Potential short-squeeze plays gained steam in 2021 and continued through 2022, with new traders looking for the next huge move.
A short squeeze can occur when a heavily shorted stock rises in value instead of falling. Short sellers could be looking to close out their position and can face a loss if they have to buy back the shares they initially borrowed at a higher price.
A squeeze can occur when short sellers are forced into buying to cover their position, which can cause shares to move up on many occasions.
Fintel Data, which requires a subscription, provides a look at several of the top shorted stocks and how likely a short squeeze is to occur.
Related Link: 5 Short Squeeze Stocks That May Soar, Plus 5 To Watch: ToughBuilt, Redbox, Revlon And More
Here’s a look at the top five short squeeze candidates for the week of Aug. 15.
- ToughBuilt Industries: Home improvement and construction product company ToughBuilt Industries Inc. (NASDAQ:TBLT) tops the short squeeze leaderboard for the fourth straight week. Data shows 51.7% of the float short, up from the previous week’s 34.1% figure. The cost to borrow on shares is 267.8%, down from last week’s 686.8%, but highly elevated.
- U.S. Well Services Inc.: Oil company U.S. Well Services (NASDAQ:USWS) makes a large leap moving up 425 positions on the leaderboard to second place for the week. Data shows 51.4% of the float short and a cost to borrow of 20.4%.
- Singing Machine: Karaoke audio equipment company The Singing Machine Company (NASDAQ:MICS) rejoins the leaderboard, moving up 14 positions to third place. The company previously topped the leaderboard in July. Data shows 26.7% of the float short and a cost to borrow of 108.0%.
- NextNav: GPS service provider NextNav Inc. (NASDAQ:NN) rejoins the top five short squeeze candidates moving up four positions from last week. Data shows 16.6% of the flaot short and a cost to borrow of 22.3%.
- Hour Loop: E-commerce company Hour Loop Inc. (NASDAQ:HOUR) holds steady at fifth place for the second straight week and continues its top five placement for several consecutive weeks. Data shows 17.5% of the company’s float short, down from last week’s 21.1%. The cost to borrow on shares is 57.6%, down from last week’s 59.2% figure.
5 Stocks to Watch
- Ranking sixth for the week is Blue Apron Holdings (NYSE:APRN), which moved up 79 positions. Data shows 44.8% of the float short and a cost to borrow of 25.1%. With the big jump and high short interest, the stock could rank in the top five soon.
- CompoSecure (NASDAQ:CMPO) continues to float around in the top ten and near the top five with a seventh place position, the same as last week. Datta shows 38.8% of the float short and a cost to borrow of 9.1%.
- Chicken Soup for the Soul Entertainment (NASDAQ:CSSE) moved up one position to ninth place. Data shows 15.3% of the float short and a cost to borrow of 340.1%. The company recently completed its acquisition of Redbox, another streaming company and high short interest stock.
- Virgin Orbit Holdings (NASDAQ:VORB) has been in the top ten of Fintel’s short squeeze leaderboard previously and makes its return at 18th place. The stock moved up 19 places, indicating increasing likelihood of a short squeeze. Data shows 11.7% of the float short and a cost to borrow of 105.7%.
- Kidpik Corp. (NASDAQ:PIK) was one of the biggest movers of the week, moving up 368 positions to 23rd place on the leaderboard. Data shows 8.9% of the float short and a cost to borrow of 137.3%.
