EchoStar heads into its August 3 earnings report with short sellers still meaningfully committed — but their conviction has clearly eroded over the past six weeks.
The short covering trend that defined July has continued. Short interest now stands at 19.3% of the free float, representing roughly 30.2 million shares — down from the late-June peak near 39.8 million shares but still elevated by any standard. The pace of covering has slowed: the weekly change is essentially flat at +0.6%, after a month-over-month drop of more than 20%. Borrow costs have fallen sharply, now near 0.41% — half what they were a month ago — and availability has opened back out to around 206%, meaning there are ample shares to borrow for anyone who wants to put on a fresh short. That combination of low cost and loose availability is not consistent with a squeeze in the making. The ORTEX short score registers 64.9, near the elevated end of its recent range, reflecting the still-significant float percentage rather than any sudden acceleration in positioning.
The debate around EchoStar centres on whether the covering reflects genuine improvement in the fundamental outlook or simply mechanical position reduction after an overstretched short. The stock has fallen 17% in the past month to $84.09, suggesting the market has not bought the bull case that any operational stabilisation is on the horizon. EV/EBITDA is running at roughly 23x, which is not obviously cheap for a business that is reporting negative earnings — the trailing PE is deeply negative, and the EV/EBIT factor score sits in the bottom 3% of the universe. Bulls can point to the forward growth narrative, where consensus EPS projections have historically carried a 100%-plus year-on-year improvement, but the EPS surprise factor score of 33 suggests the company has not been consistently delivering against those targets. Bears have the weight of a $57 billion enterprise value bearing down on a business still generating losses.
The ownership structure adds an important layer. Charles Ergen controls roughly 31% of shares directly, with the Ergen Family Trust holding another 19%. State Street added aggressively — picking up more than 9 million shares — while Wellington Management disclosed a new stake of over 7 million shares as recently as June 30. That institutional buying into weakness is notable, but insider activity has been limited to small routine awards and modest tax-related sells in the low thousands of dollars, signalling no directional conviction from management ahead of the print.
Past prints have been contained: the last two quarterly reports produced one-day moves of roughly 1% to 1.8% in either direction, though five-day drifts have been wider, ranging from -8% to +7%. The August 3 report will test whether the covering trade that characterised July has a fundamental basis — or whether 19% short interest is still the right read on a business yet to demonstrate it can turn its balance sheet around.
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