Ondas Inc. closed Tuesday at $7.04 — down 8% on the day and 15% on the week — yet the short-selling machinery around it keeps loosening, not tightening.
The cover unwind that began at the August 14 peak is still running. Short interest ticked up a fraction on Tuesday to 220 million shares, but the week-on-week picture shows a 4% decline. From the peak of 238.5 million shares in mid-August, bears have returned roughly 18 million shares. That said, the position remains one of the largest in small-cap — 59.8% of the free float, a number that reflects the updated denominator following the late-August shelf offering. The critical context from last week's note still holds: that earlier float expansion made a position of 217 million shares look like 41% of a new, larger pool. The current 59.8% reading is calculated against yet another float base revision. What has not changed is the direction — bears are trimming, not adding.
The most notable shift in the borrow market this week is cost to borrow, which has more than halved from its peak. CTB has fallen from a July high of 20.4% to 6.9% annualised as of Tuesday — a drop of 34% just in the past week and 47% over the past month. That is a significant easing of squeeze pressure. Availability remains frozen at 0%, a condition that has now persisted for well over six weeks without interruption, matching the 52-week tightest reading. The falling CTB despite zero availability is unusual: it suggests that returning shorts are releasing shares back into the lending pool fast enough to ease pricing pressure, even though the pool itself remains fully spoken for. Options positioning adds little to the bear story — the put/call ratio is 0.46, barely above its 20-day average of 0.44, and sits well below its 52-week high of 0.54. This is not a market reaching for downside protection.
Analysts remain firmly on the bull side, though the data is two weeks old. Following the August 13 earnings print — which sent the stock down 5.4% on the day and 14% over five sessions — Ladenburg Thalmann raised its target to $22.75 and Oppenheimer lifted to $18, both maintaining positive ratings. Needham reiterated Buy at $19. Roth Capital initiated at Buy with a $13 target. The mean target across the four active analysts is $19.42, against a current price of $7.04. That implied upside of roughly 176% is notable, though the stock's EPS factor score ranks in the 96th percentile — meaning the company has consistently beaten estimates — while the short score rank of 2 and utilization rank of 2 confirm this remains one of the most heavily shorted and tightly-borrowed names in the ORTEX universe. The bull case centres on a strong backlog and ISR-as-a-Service positioning. The bear case points to defense spending unpredictability, capital intensity, and sustained losses. There is no middle ground on this name — the gap between the analyst consensus and the current price reflects that standoff.
Institutional ownership tells its own story. BlackRock filed a fresh 13G in late July disclosing a 7.2% stake of 38 million shares — a new position. Laurence E. Hirsch filed a separate 13G in early July at 5.7%. Vanguard Capital Management (a separate entity from The Vanguard Group, which filed in March showing it had exited entirely) disclosed 5.16% in late July. Meanwhile, the sole 13D activist on the register, Joseph V. Popolo, has trimmed from 8.32% to 4.95% as of his June 2025 amendment — below the 5% threshold and potentially exited without a further filing, per standard 13D/G disclosure mechanics. The arrival of BlackRock and two new passive holders at the 5% level, at the same time bears are unwinding, creates an unusual structural mix: large passive longs absorbing shares while shorts gradually exit a still-enormous position.
Peers offered no shelter this week. MOB fell 7.6% and LTRX dropped 12.1%, while CRNT and AUDC held relatively flat. The broader communications equipment group was under pressure, but ONDS underperformed even the worst of its correlated peers. The next scheduled earnings event is November 13. Between now and then, the data point worth watching most closely is whether the cover trade accelerates enough to finally crack the availability freeze — the first day borrow availability turns positive would mark a structural shift in the short thesis that the CTB trend is already beginning to hint at.
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