Select Medical Holdings enters the last week of June with a notable split between its still-cautious analyst backdrop and a surprisingly sharp reversal in short positioning — the two stories are pulling in different directions.
Short interest dropped almost 30% in a single session on June 25, falling to around 1.8% of the free float from just over 2.5% the prior day. That reversal came after shorts had been building steadily through mid-June, when the position climbed toward 3.4 million shares. At 1.8% of float, the absolute level remains low — this is not a heavily shorted stock — but the speed of the unwind is worth noting. The borrow market reflects the same easing: availability is exceptionally loose, with over 5,300% of current short interest sitting available to borrow, meaning the lending pool is nowhere near full. Cost to borrow has nudged higher over the week, almost doubling to 0.73%, but in absolute terms that remains a low-cost, easy-access borrow.
Options positioning has shifted dramatically in a bullish direction — and the move is sharp enough to stand out. The put/call ratio has collapsed to 1.22, more than 1.7 standard deviations below its 20-day average of 3.30. For most of May and early June the PCR was running near 4.0, reflecting heavy downside hedging. Something changed around June 19: puts were either unwound or call activity picked up meaningfully. At 1.22, the ratio is still modestly put-heavy in absolute terms, but relative to its own recent history, options traders are now the least defensively positioned they have been all year.
The Street remains firmly cautious, with zero buy ratings and five holds among covering analysts, all aligned at a mean target of $16.50 — exactly where the stock closed on June 26. That convergence between price and target leaves no implied upside in consensus. The most recent analyst action came from Mizuho in mid-May, when the firm downgraded from Outperform to Neutral and trimmed its target to match that $16.50 level. RBC Capital had already moved to Sector Perform in early March, cutting its target from $19 to $16.50. The direction of travel across the covering group has been uniformly lower for the better part of six months. Bulls point to a potential margin recovery in Critical Illness Recovery Hospitals if occupancy climbs back above 85%, and to IRF revenue growth running near 16%. Bears focus on the 500 basis point occupancy drop that accompanied new hospital openings and a year-over-year slide in revenue per patient day — both of which drove the 20%-plus stock drop earlier in 2026. With PE at 12.8x and EV/EBITDA near 9.7x, the valuation is not demanding, but neither multiple is moving in a direction that signals re-rating momentum.
Institutional ownership is relatively stable, with BlackRock holding nearly 14% and Glazer Capital recently adding around 2.4 million shares to reach 5.2% — the most notable active-manager move in recent filings. Insider activity over the past 90 days has been net-sell, with the CEO offloading roughly 22,600 shares in late April at $16.41, though trade significance scores for these transactions were low, suggesting routine rather than conviction-driven selling.
The next formal catalyst is the Q2 earnings release scheduled for August 6. With consensus targets pinned to the current share price and options positioning now the most call-friendly in months, the setup heading into that print is less about whether downside hedges are in place — they have largely been removed — and more about whether the occupancy and margin data can give the covering analysts a reason to move off their universally neutral stances.
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