Two days after short sellers covered aggressively, they're back. RIO short interest jumped 12% in a single day on August 25, reaching 8.88 million shares — the highest reading in three weeks.
The timing is notable. The stock has rallied 10.5% over the past week and 17% over the past month. New shorts are pressing into strength, not weakness.
Earlier reports this week noted short interest had fallen 23% over the prior month. That covering wave is now partly unwinding. From the August 17–21 lows around 7.9 million shares short, the position has climbed back to 8.88 million — a gain of roughly 970,000 shares in four days.
Week-on-week, short interest is up 11.7%. The one-month figure still shows a net decline of 13.3%, so the broader covering trend isn't fully reversed. But the single-day jump of 12% on August 25 is a sharp reacceleration.
Context matters here. Morgan Stanley initiated Underweight on August 24 with a $90 target. The stock closed August 25 at $106.81 — nearly 19% above that target. The consensus mean sits at $104.09. RIO is trading above every published price target in the snapshot.
That gap between price and analyst targets gives bears a concrete thesis. Returning short sellers don't need to fight the trend. They simply need the stock to mean-revert toward a number every major bank already thinks is closer to fair value.
The surge in short interest hasn't dented the lending pool. Availability sits at 1,201% — roughly 12 shares available for every one already borrowed. Cost to borrow edged up to 0.448% on August 25, modestly above the week-ago level of around 0.38%, but well within normal range for a large-cap miner.
Fresh short positions are cheap to establish and easy to fund. There is no borrow friction standing in the way.
Next earnings are due October 14. Short sellers rebuilding positions now — with the stock at 52-week highs and trading above all analyst targets — are likely positioning ahead of that catalyst.
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