Ultragenyx Pharmaceutical heads into the post-earnings period with a notable divergence on the table: short sellers are retreating at pace, while analysts who remain bullish are quietly marking down their price expectations.
The most striking shift in recent weeks has been the rapid unwind of short positioning. Short interest in RARE has fallen sharply — from around 16.5 million shares in mid-July to roughly 12.7 million now, a drop of more than 20% peak-to-trough. As a percentage of free float, that brings the short position to 13.2%, still elevated by any measure but well off its recent highs. The retreat looks orderly rather than panicked: availability in the lending market has opened up dramatically, with the ratio of shares available to borrow versus shares already on loan now running at over 2,000% — the loosest it has been all year, versus a 52-week low of around 705%. Borrowing costs have ticked up about 20% on the week to 0.56%, but remain in low single digits and pose no meaningful friction to those still holding short exposure. The ORTEX short score has also drifted lower, from around 59 three weeks ago to 54.8 today, consistent with a position that is unwinding rather than building.
Options traders, however, are not reading from the same script. The put/call ratio is running at 2.46 — well above its 20-day average of 2.29 and close to the 52-week high of 2.63. Taken together with an options market that turned sharply more defensive in late July (PCR climbed from around 1.0 in late June to above 2.6 by July 29), the message from derivatives is that hedging demand has intensified even as shorts cover. That is the tension worth watching: two groups of bears, one retreating, one digging in.
The analyst community delivered its verdict swiftly after the earnings print. Wells Fargo this week lowered its target to $45 from $47 while keeping its Overweight rating. Guggenheim cut more aggressively, trimming from $43 to $35 on Tuesday but also maintaining Buy. The direction of travel across recent months has been consistently downward — the consensus mean target now sits at $52.95 against a stock trading at $25.81, implying nominal upside of around 105%. That gap is wide enough to look structural rather than informational. The bull case centres on Crysvita revenue momentum, a $733 million FY26 revenue target, and a credible path to GAAP profitability by 2027 through cost discipline. Bears point to guidance that missed prior consensus by roughly $42 million, ongoing net losses of $5.83 per share for FY25, and a forward EPS momentum score that ranks in the bottom 4% of the universe. The 12-month forward EPS growth expectation, at the 96th percentile, reflects hope rather than recent delivery.
Institutional positioning adds one notable data point. BlackRock added around 2.5 million shares as of June 30, lifting its stake to 8.3% of shares outstanding — the largest declared position on the register. State Street also added modestly. The insider picture is less encouraging: the CFO has sold shares in each of the past four months, a consistent pattern of small disposals that amounts to roughly $680,000 in net insider selling over the past 90 days. These are modest in absolute dollar terms and likely represent programmatic plan sales, but the direction is one-way.
What to watch next: the next scheduled earnings event is November 5, leaving a long runway before the next hard catalyst — attention is likely to stay on Crysvita prescription trends, any pipeline readouts, and whether the short interest unwind continues through a position that remains, at 13%, meaningfully elevated relative to the broader biotech universe.
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