KFRC Bears Retreat After Earnings — Borrow Market Opens Up

Kforce Inc. reported Q2 earnings on July 27. The signals that pointed to a bullish setup ahead of that print have now resolved. Short sellers have cut further, the borrow market has loosened sharply, and call positioning remains at a 52-week extreme.

What Changed Since the Pre-Earnings Note

Five days ago, this column flagged an unusual alignment: a put/call ratio at its lowest in a year, short interest falling, and an analyst target raise. The print has now landed. The post-earnings data tells a consistent story — bears kept retreating.

Short interest fell another 11.5% in the week to July 24. It now stands at 7.4% of free float, the lowest since late June. That is down from roughly 10% in mid-June. Bears have covered into what was already a rising stock.

The Borrow Market Swings Wide Open

The starkest post-earnings shift is in the lending market. Cost to borrow has collapsed 62% in one week to just 0.37% — its lowest reading in 52 weeks. That is not a squeeze; it is the opposite. Shorts who needed stock to borrow are returning it. Availability has widened to 1,466%, up from around 955% in early July. There are now roughly 15 shares available to lend for every one currently borrowed. The borrow market has not been this loose all year.

Options Still Calling

The put/call ratio sits at 0.26 — still the 52-week low, still 1.6 standard deviations below its 20-day average of 0.80. The options market has not faded its bullish positioning after the earnings date passed. That is notable. Pre-earnings call positioning sometimes evaporates the moment results are out. Here it has held.

Analyst Confirmation

Truist Securities raised its price target to $60 from $38 on July 22 — a 58% increase — while maintaining its Hold rating. That target now sits above the current price of $55.12. The stock is up 21% over the past month, and the ORTEX short score has eased from 54.4 on July 13 to 49.9 on July 24, reflecting the reduced short pressure.

Data Summary

• Short interest: 7.4% of free float, down 11.5% week-on-week
• Cost to borrow: 0.37%, 52-week low, down 62% in one week
• Availability: 1,466% — very loose lending market
• Put/call ratio: 0.26, 52-week low
• Price: $55.12, up 20.9% over one month
• Truist target: $60 (raised from $38, July 22)
• ORTEX short score: 49.9, down from 54.4 two weeks ago

What to watch: Whether the options PCR normalises toward its 20-day mean of ~0.80 now that earnings have passed, and whether short interest continues falling or stabilises near the June lows.