Short Report: Bears questioning Cinemark, Groupon rallies

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 up 1.2%, the Nasdaq Composite was up 1.3%, the Russell 2000 index was up 1.5%, the Russell 2000 Growth ETF (IWO) was up 1.3%, and the Russell 2000 Value ETF (IWN) was up 1.6% in the four-day trading session range through May 29.

SHORT INTEREST GAINERS

• Ortex-reported short interest in Cinemark (CNK) has tracked sideways in 16% to 22% range from mid-March until the final week of May, even though the stock has enjoyed a runup of about 35%. This week however, short positioning as a percentage of free float has jumped more dramatically, increasing from 18.8% to a four-month high of 26.6%. Sentiment on the stock has remained positive following the company’s Q1 results on May 2nd as shares have gained 13% since those earnings inclusive of Friday’s 2.5% rally and were up 1.6% in the four-day period covered through Thursday, though bears are increasingly questioning whether the robust box office slate will match demand from tightening consumer budget.
• Ortex-reported short interest on Groupon (GRPN) had fallen precipitously from 67% in late December to a ten-month low of 26% on Monday as bears fled the tripling in the stock price that started in mid-March after the company’s Q4 results and was spurred further by another strong performance in Q1. The rest of the week however, shorts as a percentage of free float turned higher, rising from 26% to nearly 29%, even though the price action is not yet matching the increased willingness by the bears to test the sustainability of the bounce. In the four-day period covered, Groupon shares were up 10.4%, and year-to-date, the stock has gained 140%.
• Ortex-reported short interest on Avis Budget (CAR) has continued to increase sharply, rising another five and a half percentage points this week to 47.8%. Shorts as a percentage of free float on the stock troughed at just 12% in late January prior to the start of its run, and the current levels are now the highest since June of 2020. The stock, meanwhile, bottomed in mid-March but has since more than doubled from those lows, with a year-to-date gain topping 50%. This week, Avis Budget shares were up 1.5% in the four-day period through Thursday.
• Ortex-reported short interest on Sunrun (RUN) had peaked around 35% in late April and receded to about 29% over the next three weeks, though this week has seen shorts as a percentage of free float jump again while the stock sold off heavily. Bearish positioning rose to 31.1% and days-to-cover on the name was up 30 basis points to 4.5. The stock, meanwhile, was up about 2% in the four-day period through Thursday and ended the week with a 9% jump on Friday, though shares are still down 43% from their recent peak on May 13 and down 19% year-to-date.

SHORT INTEREST DECLINERS

• Ortex-reported short interest on Guess (GES) had peaked at 39% in mid-March before a buyout offer from private equity name WHP Global had scurried bears to the sidelines with a 13 percentage point retreat that accompanied a 25% jump in the stock price. Authentic Brands Group (AUTH) had joined the bidding war for Guess in late April, giving the stock price another jolt higher and the rebuilding shorts another blow. This week, as the company prepares to report its Q1 results on Thursday, shorts as a percentage of free float on Guess fell from 25.8% to 20.2% – a one-year low. Guess shares were flat in the four-day period covered but slipped 6% on Friday. Relative to the level just before the WHP bid however, the stock is still up 7%.