Blue Owl Capital enters the final days of June with one of the most aggressive short-building episodes in its recent history, even as the borrow market remains remarkably relaxed — a contradiction that defines the week's story.
Short interest has climbed to nearly 22% of the free float, up 7% on the week and 16% over the past month. That puts the absolute share count at roughly 145.9 million — a level not seen in recent history for OWL. The acceleration came in a single step: positions jumped over 8.6 million shares between June 22 and June 25, the sharpest one-day addition in the 30-day window. Yet the borrow market tells a strikingly different story. Availability runs at around 216% — meaning there are more than two shares available to lend for every share already borrowed — and cost to borrow sits at just 0.86%, barely changed from mid-June. Despite a 36% rise in borrow cost on the week, the absolute level remains trivially low. Short sellers are growing more aggressive, but there is no squeeze dynamic in the lending pool. Options positioning leans mildly defensive: the put/call ratio of 1.35 sits about one standard deviation above its 20-day average, a sign of some downside hedging, but nowhere near the 2.07 extreme seen over the past year.
The Street has been broadly cautious since late April, with the weight of analyst moves tilting toward target cuts rather than upgrades. JP Morgan trimmed its target twice in quick succession. Goldman Sachs cut from $14 to $9. Barclays and Piper Sandler also lowered targets, all while maintaining their ratings. The net result is a mean analyst price target near $12.63 — still roughly 47% above the current price of $8.57, implying significant embedded upside on paper. But with the stock down 15% over the past month and 10% in the past week alone, that gap has widened because the stock has moved, not because the Street turned bullish. Valuation multiples reflect the compression: the P/E has contracted by nearly 1.8 turns over 30 days, and the P/B has shed 0.40 turns. The ORTEX short score has held stubbornly in the 67–68 range all week, placing OWL in the bottom 6th percentile of its universe on that metric. Forward EPS momentum ranks in the 97th percentile — an unusual combination of extremely bearish short positioning alongside very strong forward earnings estimates.
The bull case centres on OWL's positioning in digital infrastructure: long-term partnerships with hyperscalers, a vertically integrated platform, and a fee-related earnings model that is less cyclically exposed than equity-heavy peers. Bears point to recent fund agreement controversies, potential fundraising headwinds, and the portfolio's exposure to software credit — a segment under pressure from AI displacement. The peer group has not been spared either. ARES fell 15.6% on the week, STEP dropped 12.5%, while BX and KKR held losses closer to 7%. OWL's 10% decline puts it in the middle of that range — underperforming Blackstone but holding up better than Ares, suggesting the selling is sector-wide rather than OWL-specific, though the short-interest build here is meaningfully larger than what is typically seen in the alternatives space.
The most interesting institutional angle is the concentration at the top. Capital Research and Management holds 17.8% of shares, a position that grew by over 21.9 million shares in the most recent filing period. FMR added 2.9 million shares. That kind of accumulation by large long-only institutions, running alongside a 22% short interest print, sets up an unusual ownership structure — a crowded short sitting beneath a concentrated long base. Insider data is stale at over 130 days, but the December 2025 founder purchases by Co-CEOs Doug Ostrover and Marc Lipschultz — both at around $15.06 — now sit roughly 43% above the current price, a paper loss that will likely shape executive commentary at the next earnings event.
The next scheduled earnings event falls on August 6. The last print, on April 30, produced a one-day move of 12.4% and a five-day follow-through of 16.6% — by far the most volatile reaction in the recent history window. With short interest near a local peak and a concentrated long base watching a stock that has shed a third of its value since founder purchases in December, the August print is shaping up as a high-stakes test of whether the fee-revenue model can provide the reassurance the current price clearly lacks.
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