Sable Offshore Corp. enters the final week of June with shorts refusing to cover and borrow costs quietly tightening — a combination that keeps the stock pinned at multi-month lows.
The short position has barely moved despite a 39% collapse over the past month. SI holds at 17.8% of the free float, up roughly 1.6% on the week and 4% over the month — shorts added modestly into the decline rather than trimming. What has changed is the cost of maintaining those positions. Cost to borrow has risen 33% on the week to 1.07%, and is up 45% over the past month, reaching its highest level since early June. That steady grind higher in borrow cost, while availability remains in a wide range of 68%–101% over the past two weeks, suggests demand for the short is increasing even as supply stays adequate. The ORTEX short score of 75.6 ranks in the 1st percentile of all stocks — one of the most aggressively shorted names in the market, a reading that has been climbing steadily since mid-June. Options positioning has tilted modestly more defensive, with the put/call ratio at 0.34, running above its 20-day average of 0.31 and roughly 1.5 standard deviations elevated — though still far from the 52-week high of 1.38, so the options market is cautious rather than panicked.
The Street is firmly in bull territory on paper, but the targets tell a story of persistent optimism meeting persistent disappointment. The only active coverage comes from Jefferies, which maintained its Buy in April while cutting the target to $24 from $30 — itself a significant trim. The stock now trades at $8.94, a 63% discount to that reduced target. Benchmark downgraded to Hold in early March, a signal that at least one firm lost patience with the recovery narrative. With the stock near $9, the EV/EBITDA multiple sits at a compressed 3.7x and the PE at 6.9x — optically cheap, but the bear case rests on commodity price exposure, a concentrated single-asset base at the Santa Ynez Unit, and the operational fragility that has defined the name since its restart. The EPS surprise factor score of 92 is genuinely strong, meaning the company has been beating estimates — a data point bulls can point to as evidence the operational ramp is real.
Institutional ownership reveals a split between committed longs and recent sellers. Pilgrim Global and Encompass Capital together hold nearly 21% of shares. Capital Research trimmed by 1.7 million shares last quarter, and Alyeska cut its position by 8.4 million shares. Offsetting that, BlackRock added 2.6 million shares and Morgan Stanley added 2 million through Q1. CEO and founder James Flores sold roughly $930,000 of stock at $13.56 in late April — before the bulk of the decline — while simultaneously receiving a 175,000-share equity award. The CFO and General Counsel both followed the same pattern: selling shares received as awards at the same date and price. Net insider activity over 90 days is a positive $19 million, but much of that reflects the award grants at zero cost rather than open-market conviction buying.
Prior earnings reactions have been volatile and inconsistent. The June 10 print produced a modest 1-day loss of less than 1%, but the stock fell 13% over the following five days. The May 6 print hit the stock for 10% on the day and a further 8% over five days. The May 14 report was the exception — a 15% jump on the day. The next earnings event is pencilled in for August 12, leaving roughly seven weeks for the market to determine whether the production trajectory at Santa Ynez justifies any re-rating, or whether the current short interest — now at a month-long high and held by a cohort showing no inclination to cover — accurately reflects where the stock deserves to be.
What to watch: whether cost to borrow continues its upward grind toward the 1.5%–2% range that would signal genuine squeeze tension, and whether the August 12 earnings print delivers the kind of production update that could force the first meaningful short-covering this stock has seen in months.
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