Short Report: Bears add to Lovesac, Kohls as consumer confidence plummets

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, excluding holidays. As a basis of comparison for stocks discussed below, the S&P 500 index was down 3.8%, the Nasdaq Composite was down 4.2%, the Russell 2000 index was down 3.5%, the Russell 2000 Growth ETF (IWO) was down 3.3%, and the Russell 2000 Value ETF (IWN) was down 3.7% in the five-day trading session range through March 13.

SHORT INTEREST GAINERS

• Lovesac (LOVE), a pandemic darling that saw its stock price soar over 20-times over from 2020 to mid-2021, has had a much more difficult time re-establishing any momentum since its precipitous decline in 2022. Just when it looked like the name was breaking out of its slump in late November, a much worse than expected earnings report in December has knocked the stock price back to its lows. Shares have been especially pressured since mid-February, as the turn in consumer sentiment has soured investors’ outlook on the specialty furniture brand, and short-sellers are betting on more pain. Ortex data saw shorts a percentage of free float gaining this week from 23.9% to 26.5% and days to cover rising from 6.9 to 8.9 despite the pickup in trading volume. The stock, meanwhile, was down 12% in the five-day period covered through Thursday, and down again Friday despite the market bounce, with shares now losing 34% year-to-date.
• Kohl’s (KSS) disappointing Q4 comps and FY25 guidance that was well below consensus earlier this week had sent the stock down by double digits, but rather than book profits, bears are betting on a death spiral for the company with higher short positioning. Ortex-reported shorts as a percentage of free float rose from 45.1% to 51.6% – the highest levels on record – with days-to-cover on the name dropping from 8.0 to 7.7 on sharp increase in post-earnings volume. The stock, meanwhile, has fallen 33% post earnings and 27% in the five-day period covered through Thursday. Year-to-date, Kohl’s shares are down 43%, with the stock unable to muster any gains even during Friday’s rally.
• Ortex-estimated short interest on HighPeak Energy (HPK) spiked from 23.8% to 29.5% following Q4 results and guidance, while days-to-cover on the name slipped three points from 32.1 to 29.8 on higher trading volume. Earnings were better than expected, but the company’s sales volumes were up just 1% and the management’s 2025 production volume estimate calls for a flat or lower reading vs. 2024. The stock fell over 7% on the earnings, even though Friday’s gains helped HighPeak close the gap lower. In the five-day period covered, HighPeak was down 5.2%, though including Friday’s 7% jump, shares were up 2%.
• Ortex-reported short interest on Viasat (VSAT) had troughed below 20% for just over two weeks, though this week short positioning saw a sharp jump in the absence of any significant news or stock price volatility. Shorts as a percentage of free float on Viasat rose from 19.1% to 24.5%, a one-month high. Shares, meanwhile, were down less than 2% through Thursday. Viasat is also up 16% year-to-date, having gained 5% in Friday’s broad-based market rally.

SHORT INTEREST DECLINERS

• EV charging company EVgo (EVGO) reported another Q4 earnings loss with declining revenue last week, with the stock also earning no fewer than five price target cuts from sell-side research firms as slowing charger deployment pace and uncertainty over Federal funding for vehicle electrification dominated analyst caution. With the stock having already lost 40% year-to-date, however, bears are moving on from the name and covering their positions post-earnings, as evidenced by the stock trading down less than 2% since that report amid continued negative analyst sentiment. Short positioning as a percentage of free float on EVgo was down from 36% to a four-month-low of 28% and days to cover was off from 3.5 to 3.2.