![]() Its short interest as a percentage of shares outstanding or public float is lower than several other popular software stocks and more or less at par with the others. Let me explain both the points.įirst, I compiled the short interest data for similarly positioned software companies and found that Palantir isn’t a heavily shorted name by industry standards. I’d like to point to readers that this isn’t an alarmingly high figure by industry standards and the recent buildup of short interest isn’t necessarily a tell-tale sign of upcoming shareholder woes. Per Wall Street Journal, the company has about 1.02 billion shares floating and about 9.7% of it stood shorted at the end of the last short cycle. Per Seeking Alpha and Bloomberg, the data analytics company has about 1.47 billion outstanding shares which means that only about 6.7% of this share total had been shorted at the end of the last cycle. This short-squeeze-driven rally can be meteoric if market participants start scrambling to cover a significant number of short positions, in a brief time period, like it happened in the case of GameStop earlier this week.Ĭoming back to Palantir, its short interest figure rose 9% sequentially to 98.9 million shares in the cycle ending 15 January. This scenario of heightened demand and limited supply can variably push the stock price higher and is termed as a short squeeze. If the stock starts to rally after this, these short-side market participants are then forced to buy the stock and cover their positions to prevent further losses. A sharp rise in the metric indicates that market participants have actively shorted a particular stock and, so, it's considered to be a bearish development. (Image source, Image labeled for reuse) The Short Buildupįor the uninitiated, short interest is the total number of short positions that are open and are yet to be covered. So, in this article, I wanted to shed light on the matter and explain why investors shouldn’t fret over the development just yet. While some market commenters are viewing this rise as a bearish development, others are comparing the scenario with GameStop’s and are exploring the possibility of a mega short squeeze already. Latest data reveals that short interest in the stock rose by 9% at the end of the last cycle. ![]() It seems like Palantir ( NYSE: PLTR) is surrounded by speculation once again.
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