RadNet heads into its August 7 earnings print with short sellers at their most committed level in months and the stock trading well below analyst targets — a setup worth watching closely.
Short interest is the central tension here. Bears have built a position representing 13.1% of the free float — roughly 10 million shares — a level that has barely budged across the past two weeks despite a 2.2% gain in the stock. More telling is the monthly picture: short interest climbed 6.1% over the past 30 days, pointing to fresh conviction rather than stale positioning. The ORTEX short score has edged up to 71.5, its highest reading in the recent history and ranking in just the 5th percentile of the broader universe — meaning roughly 95% of stocks carry a less bearish signal. Days to cover sit near 11, a meaningful buffer that amplifies any squeeze risk if the August 7 print surprises positively.
The borrow market tells a calmer story. Cost to borrow is low at 0.51% and has drifted lower over the week, down around 7%. Availability is ample at roughly 250% of short interest — meaning the lending pool holds more than twice the shares currently borrowed — so there is no structural tightness pressing on the bears. The put/call ratio at 0.72 is almost exactly in line with its 20-day average, a z-score close to zero, suggesting options traders have not added a fresh directional lean ahead of results. The short story is about conviction in the position, not crowding in the derivatives market.
The Street broadly likes the stock but has been trimming its ambition. The mean price target runs near $89.75, implying more than 40% upside from the current $63.22 — a gap that sounds compelling until you note that Barclays has cut its target twice since April, from $86 to $70 and then to $65, while maintaining its Overweight rating. That pattern — positive on the name, cautious on the number — describes most of the analyst community right now. Bulls point to technology investments driving productivity gains, joint venture expansion adding volume, and margin benefits from growth in advanced imaging procedures. Bears flag reimbursement risk, labor cost pressure, and uncertainty about the path to AI segment profitability. The EV/EBITDA multiple running at 16.2x and a trailing PE above 83x leave little room for disappointment. EPS surprise ranks in the 92nd percentile historically, which is the one factor score worth flagging positively — RadNet has a strong track record of beating estimates.
Institutional ownership adds a layer of interest. T. Rowe Price added 633,000 shares in Q2, a meaningful addition at roughly 5.3% of the float. BlackRock added 208,000 shares over the same period, now holding 12.8% of the company. The buying from active managers contrasts with recent insider activity: a cluster of divisional CEOs and a lead director sold shares in mid-June, with Stephen Forthuber alone offloading around $2.6 million worth near $58. That insider selling happened at prices below where the stock trades today, which softens the negative read somewhat.
The last two earnings reports produced day-one moves of -3.8% and -3.9%, both followed by a steeper five-day slide of between 7% and 11%. With shorts at their highest level in months, the borrow market well-supplied, and analyst targets that have been methodically trimmed since the start of the year, the August 7 print becomes a referendum on whether RadNet's imaging volume and AI investments can shift the narrative — or whether bears, dug in at 13% of float, get their third consecutive post-earnings vindication.
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