Pattern Group Inc. heads into a quiet mid-June week with an interesting split: a stock up 16% over the past month that has given back 6% in the last five sessions, even as short sellers have been adding cautiously and the lending market suddenly tightens.
The most notable development this week is in the borrow market. Availability has collapsed from effectively uncapped levels to roughly 905% — still loose in absolute terms, but the directional move is dramatic. Just eight trading days ago, availability was running above 9,000%, meaning the lending pool was almost entirely unused. It has tightened sharply each session since June 9, a straight-line move that coincides with short interest climbing nearly 13% over the week to 1.4% of the free float. That's still a low absolute level, but the speed of the change is worth watching. Cost to borrow, meanwhile, has been choppy — bouncing between 0.4% and 1.2% without a clear trend, suggesting the borrow squeeze hasn't yet translated into pricing pressure. Availability remains well above the 52-week low of 87%, so there is still ample room for new short positions to be established before the pool becomes genuinely stressed.
Options positioning offers a contrasting read. The put/call ratio at 0.16 is barely above its 20-day average of 0.15 — a z-score of just 0.45 — indicating the options market is not pricing in any particular stress. For context, the PCR spent much of May in the 0.44–0.49 range, close to the 52-week high; the current level represents a decisive shift toward call-side dominance. The ORTEX short score has drifted up to 42.7 from 37 at the start of the month, flagging the building short interest but still landing well short of territory that would typically signal crowded positioning.
The Street is broadly constructive. Every one of the seven covering analysts rates PTRN a Buy, giving it a perfect analyst recommendation differentiation score — ranked at the 100th percentile in ORTEX's factor scoring. The mean price target of $22 implies roughly 15% upside from the June 16 close of $19.17. The most recent target moves came from JP Morgan and Needham in early May, both lifting targets after what appears to have been a strong earnings print: the stock jumped 21% on the day of the May 6 result and held nearly all of those gains over the subsequent week. The bull case rests on data-driven brand partner retention and a scalable e-commerce acceleration model. Bears counter that margin compression from heavier AI investment and declining net revenue return per brand are structural headwinds. Factor scores lean bullish on earnings quality — EPS surprise ranks in the 86th percentile, 90-day earnings momentum in the 88th — though valuation is a notable weak spot, with the EV/EBIT score ranking in just the 4th percentile and a trailing PE of roughly 31x.
Ownership is tightly concentrated. The two largest holders — The Wright and Alder Irrevocable Trusts — together control over 42% of shares and have made no changes to their positions in recent filings. Alyeska Investment Group added just over two million shares in the quarter ending March, while Wasatch Advisors built a more modest position. On the insider side, recent activity has been limited to routine small sales by an independent director — nothing that alters the read on management conviction, especially given the last material insider action was a significant block sale by the founder-CEO in September 2025 at $13.
The next scheduled catalyst is the August 5 earnings release. Given the stock's history of 20%-plus single-day moves on results, and with short interest now trending upward from a low base, the question heading into that print will be whether the borrow market tightens further — and whether the margin compression the bears are tracking shows up in the numbers.
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