WBI heads into its August 6 earnings print with a striking divergence: short sellers have been covering aggressively while sell-side conviction is rising — a combination that has helped push the stock up 7% in a month to $33.55.
The short side tells the more dramatic story. Short interest has collapsed by 61% over the past month, falling from roughly 12 million shares to just under 5 million, now representing 11.4% of the free float. That is still a meaningfully elevated level, but the trajectory matters: bears have been unwinding steadily since late June, when short interest peaked near 25% of the float. Borrow conditions confirm that pressure has eased. Availability has jumped to 133% — more than three times where it stood in late July — meaning shares are now plentiful for anyone who still wants to establish a short position. Cost to borrow has dropped 38% over the month and now runs below 1%, a far cry from the tighter lending environment that characterized the mid-July period. The options market reinforces the less defensive tone: the put/call ratio at 0.92 is running below its 20-day average of 1.09, a modest lean toward calls that contrasts with the heavy put positioning seen through most of July.
The analyst community has been consistently constructive, and recent moves have pushed targets higher. Goldman Sachs lifted its target from $36 to $41 in mid-July while keeping its Buy rating — the most recent bellwether action, coming just three weeks before the print. Morgan Stanley upgraded the stock to Overweight in April and has since raised its target to $38. The consensus mean price target of $34.57 sits close to the current price, leaving limited implied upside from the Street alone. Bulls point to WBI's structural advantages: 10-year contracts with minimum volume commitments and fee escalators anchored in the Delaware Basin, a partnership with LandBridge providing disposal capacity, and growing demand for produced water management from Permian E&P operators. Bears focus on a different set of risks — slower drilling activity, declining disposal capacity in the Stateline area, and the possibility that reduced pipeline throughput compresses margins enough to threaten the dividend. The ORTEX factor scores add a wrinkle: EPS momentum ranks in the 87th percentile over 30 days and 84th over 90 days, but the stock's short score of 67.6, while easing from a recent peak above 72, remains elevated by historical standards.
Institutional ownership adds an interesting dimension to the setup. ALPS Advisors holds a dominant 21% of shares and added its entire position as recently as early July — a fresh, concentrated bet. T. Rowe Price added over 3.2 million shares in the most recent quarter, building to 11.4% of the company. On the other side, Devon Energy — a 10% owner — sold approximately 7.6 million shares in late June at $30.05, a transaction worth roughly $230 million in net insider selling. That sale came as a strategic divestiture rather than a traditional insider trade, and the stock has since recovered 12% from that level. The board's own buying cluster from January, when the CEO, CFO, and two other executives all purchased shares between $19 and $21, now looks prescient given the move to $33.55.
The print will test whether WBI's contract-backed revenue model is delivering the volume growth and margin quality that would justify continued short covering — or whether the bears retreating on price were simply cutting losses ahead of news that confirms their fundamental concerns.
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