Three signals converged on GRPN today. Short interest jumped. The borrow pool dried up completely. And options traders are buying calls at the fastest pace in a year. Each one would be notable in isolation. Together, they describe a stock under acute structural stress — ten days before earnings.
Previous notes flagged a slow, grinding reduction in short interest through mid-July. That unwind has reversed sharply. Short interest jumped 12.1% in a single week to 32.5% of free float — back above the 31%+ readings that defined early July. FINRA's fortnightly confirms 13.4 million shares short, with days-to-cover at 9.1 days. Bears added to a position they were supposed to be leaving.
The timing is notable. The stock fell 7% last week. Bears pressed the move. But they are doing so into a lending market that has effectively shut them out.
Availability has collapsed to 2.5% — roughly one share available for every forty already lent out. That matches the 52-week pattern: brief recoveries to the low double-digits, followed by violent collapses back to near-zero. The pool has spent the majority of July in single digits, and it is back there now. The ORTEX short score sits at 76.7, its highest reading in the current series.
What makes this convergence genuinely unusual is what is happening simultaneously in options. The put/call ratio hit 0.33 on Friday — a 52-week low. The 20-day mean is 0.36, and the z-score on today's reading is -2.7. That is not a modest lean toward calls. It is the most aggressive call-buying bias this stock has seen in a year, arriving at the exact moment the borrow market is completely locked.
Short sellers added aggressively. Options buyers responded by loading up on calls. Both sides are making large bets ahead of August 6 earnings.
The cost to borrow has risen 18% over the past week to 2.23%. That is not an extreme number in absolute terms, but the direction is consistent: every new short position costs more than the last one. With days-to-cover at 9.1 — the highest reading in recent data — any accelerated covering would take nearly two weeks at current average volume.
Goldman Sachs maintains a Sell rating with a $13 target, a stark contrast to Roth Capital's Buy at $47. The stock sits at $25.81, up 54% over the past month. The analyst divide is as wide as it has been all year.
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