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‘Squeezable’ AMC, GameStop stocks break out to multi-month highs
Both ‘meme’ stocks made S3’s list of 25 stocks most likely to benefit from a short squeeze
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Shares of both AMC Entertainment Holdings Inc. and GameStop Corp. surged to multi-month highs Wednesday, as they extended breakouts above previous chart resistance levels.
The rallies come after Ihor Dusaniwsky, managing director of predictive analytics at S3 Partners, said in a recent note to clients that the two “meme” stocks made his list of the 25 most “squeezable” U.S. stocks, or those that are most susceptible to a short-covering rally.
AMC’s stock
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jumped 5.0% in midday trading, putting them on track for the highest close since April 20.
The movie theater operator’s stock’s gains in the past few months had been capped just above the $16 level, until it closed at $16.54 on Monday to break above that resistance area. On Tuesday, the stock ran up as much as 7.7% to an intraday high of $17.82, before suffering a late-day selloff to close down 1.% at $16.36.
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FACTSET, MARKETWATCH
GameStop shares
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powered up 3.8% toward their highest close since April 4.
On Monday, the stock closed above the $150 level for the first time in three months, after multiple failures to sustain intraday gains to around that level over the past couple months.
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FACTSET, MARKETWATCH
Meanwhile, S3’s Dusaniwsky provided his list of 25 U.S. stocks at most risk of a short squeeze, or sharp rally fueled by investors rushing to close out losing bearish bets.
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Dusaniwsky said the list is based on S3’s “Squeeze” metric and “Crowded Score,” which take into consideration total short dollars at risk, short interest as a true percentage of a company’s tradable float, stock loan liquidity and trading liquidity.
Short interest as a percent of float was
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, based on the latest exchange short data, and was
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He said an additional variable that makes a stock “squeezable” is substantial net-of-financing mark-to-market losses.
Over the past month, AMC’s stock has soared 37.0% and GameStop shares have hiked up 16.5%, while the S&P 500 index
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has gained 7.8%.
“[T]he chances of getting a tap on the shoulder from a Chief Risk Officer to cut losses and get out of a trade is higher for these stocks,” Dusaniwsky wrote. “The higher chance that short sellers may be forced to buy-to-cover will only help push stock prices even higher — and making the squeeze even tighter for the shorts still in the stock.”
AMC, which had about $1.50 billion in short interest still open as of Monday’s close, was 16th on Dusaniwsky’s list, and GameStop, with $1.92 billion in short interest, was 24th.
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Meanwhile, the top 5 stocks on Dusaniwksy’s list were those of Faraday Future Intelligent Electric Inc.
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, Canoo Inc.
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, Gossamer Bio Inc.
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, Verve Therapeutics Inc.
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and Lightwave Logic Inc.
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