Short sellers are fleeing GILD. The options market is leaning bullish. The two signals are pointing the same way.
Short interest fell 20.3% in a single day on September 24. It now stands at just 1.47% of free float — down 25.2% over the past month.
This is a four-week covering trend that compressed dramatically in the final session. At these levels, short interest carries little weight as a bearish signal. The borrow market reflects the same picture: availability is effectively unconstrained, with ample shares to borrow and cost-to-borrow at just 0.55%.
The covering isn't driven by a squeeze. There's no borrow stress. This looks like voluntary position reduction.
The put/call ratio hit 0.51 on September 24. The 20-day mean is 0.54. The z-score is -1.29 — statistically tilted toward calls relative to recent norms.
The 52-week PCR range runs from 0.40 to 0.92. The current reading sits in the lower third. Options positioning has drifted steadily more call-heavy since mid-September, as the PCR declined from 0.58 to its current level.
That's options traders reducing downside hedges as shorts cover. Both groups moving in the same direction at the same time is the convergence worth watching.
This consistency supports what the previous ORTEX note flagged: EPS momentum ranks in the 93rd and 95th percentiles over 30- and 90-day windows respectively. Estimate revisions have been running hot even as the stock pulled back slightly — down 1.1% Thursday, flat on the week.
The analyst picture remains split. HSBC raised its target to $175 (from $155) on September 10. The consensus sits at $158.65 against a current price of $149.69. T. Rowe Price added 3.79 million shares in the most recent reporting period — the largest institutional build in the top-15 holder list.
The ORTEX short score is stable at 32.9, near its recent range low. Nothing in the lending market suggests renewed short pressure is building.
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