FLY has pulled back 3.8% on Tuesday to $26.14, giving up a chunk of last week's gains, while the short-side exit that defined the prior note has largely run its course — leaving the stock in a quieter but still unsettled place.
The short position has stabilised. At 6.82% of free float, short interest is barely changed from the 6.8% reported a week ago, and down only 8% on the week — a meaningful deceleration from the rapid cover sequence that ran through late July and early August, when shorts trimmed from above 13 million shares to the current ~10.9 million. The short exit has not reversed; it has simply paused. Borrowing costs have eased further to 0.44%, their lowest level in at least 30 days and nearly 18% below last week's level — a signal that there is no fresh demand for borrows, and no mechanical pressure on remaining shorts. Availability is sitting near 60%, which is tight but not extreme, and up modestly from the low-50s seen earlier in August. Taken together, the borrow market looks relaxed: the bears who remain are not under pressure, and no new shorts are being added aggressively.
Options tell a more bullish story. The put/call ratio has drifted to 0.318 — below its 20-day average of 0.337 and well off the defensive readings above 0.40 that prevailed through July. With a z-score of -0.60, options positioning is leaning slightly toward calls, suggesting the remaining options market participants are not hedging against a further slide. The PCR 52-week range puts this in context: it has been as high as 1.63, and the current reading is close to the annual low of 0.257. That is a meaningful shift in tone from a month ago.
The Street is sitting in an awkward spot. Two weeks ago, Roth Capital and B. Riley both cut their price targets on FLY — to $45 and $50 respectively — while keeping Buy ratings, a classic post-print target haircut. Cantor Fitzgerald reiterated Overweight at $35. Wells Fargo initiated at Equal-Weight with a $25 target in late July, effectively flagging fair value near the current price. The mean analyst target is $41.60, implying about 59% upside from here — but that figure is dragged up by residual high targets, and the distribution is wide. Goldman Sachs holds a Neutral at $32, Morgan Stanley Equal-Weight at $37. The bull case centres on Firefly's positioning as a flight-proven small-launch operator with growing government and commercial demand. Bears point to operating losses, government revenue concentration, and integration risk — all confirmed by the company's own recent results, which produced a modest 3% one-day pop on August 11 followed by a tepid 1.5% five-day move.
Institutional flow is worth noting. BlackRock added nearly 3.9 million shares in the most recent reporting period, and State Street added 3.7 million — both large additions for a stock of this size. Tema ETFs and Van Eck also built new positions. AE Industrial Partners remains the dominant holder at 30% of shares, though they sold a combined ~8 million shares at $48 in early June — well above where the stock trades today. That overhang has passed, but it contextualises how far the stock has retreated from early-summer levels.
The ORTEX short score of 63.9 has edged down slightly from its 64.6 peak ten days ago but remains elevated, ranking FLY in the bottom 5th percentile on short score across the universe — meaning the overall short positioning picture is still meaningfully bearish by broad market standards, even after the cover sequence. In the peer group, RKLB fell 3.6% on Tuesday and LUNR dropped 5.3%, suggesting sector-wide pressure was the dominant force behind Tuesday's decline rather than anything FLY-specific. SIDU fell 3.7% on the day and is down 6% on the week — the weakest of the close peers.
What to watch next: whether short interest resumes its downward drift toward the 5–6% range, or whether the stabilisation at ~6.8% of float marks a floor where bears are comfortable holding, with analyst target resets still filtering through and the borrow market remaining loose enough to rebuild positions cheaply.
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