MoonLake Immunotherapeutics reported earnings on August 10. Short sellers covered aggressively. The borrow market opened wide. Then options traders started buying puts at the fastest clip in three weeks. Three signals. Three different directions.
Short interest fell 11.5% in a single day on August 11, dropping to 7.9% of free float — the lowest reading since late June. That's a meaningful unwind. For context, SI had been locked in a tight band around 6.4–6.7 million shares for most of July. Tuesday's read cut that to 5.7 million.
The borrow market confirms the retreat. Cost to borrow collapsed 54% in one week to just 0.23% — a multi-month low. Availability sits at 926% of short interest, meaning there are roughly nine shares available to lend for every one currently borrowed. The lending pool is wide open.
The short score reflects the shift. It dropped from ~60 earlier this week to 55.4 on August 11 — a five-point slide in four sessions.
The August 10 print landed with a -9.1% one-day move. That follows a strong June update (+10.5%) and a solid May report (+6.7%). The stock now trades at $17.23 — well below the $20 level where the CEO, CSO, and CFO all sold shares in June and July. Those insider sales, worth roughly $9.6 million net over 90 days, were flagged in the previous MI note ahead of the print. The insiders sold at a premium that no longer exists.
HC Wainwright raised its price target to $50 from $45 this morning, maintaining its Buy rating. That puts the average analyst target at $28.15 — 63% above the current price. The bull case centres on the sonelokimab (SLK) programme for hidradenitis suppurativa and a well-funded balance sheet. Bears point to recruitment risks and competitive pressure.
Here's the tension: while shorts cover and the borrow market loosens, the options market is moving in the opposite direction.
The put-call ratio hit 0.28 on August 12. That is 3.58 standard deviations above the 20-day mean of 0.23. It is the highest PCR reading in over three weeks. Relative to the 52-week low of 0.11, it remains modest — this is not a panic-level reading. But the directional move is sharp and statistically unusual.
Put demand is rising precisely as short covering accelerates. Options traders may be hedging remaining long positions after the post-earnings drop, or establishing new downside protection cheaply while borrow costs are low.
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