A rare analyst downgrade lands the same week short interest hits a multi-month peak. Options traders are pushing back — hard.
DA Davidson's Clark Wright cut MANH from Buy to Neutral this morning. The target stays at $210 — barely above the current $206 close. That flat target combined with a rating drop is a meaningful signal: conviction in the upside has gone.
This reverses Wright's own July 29 upgrade cycle, when he raised targets post-earnings following Manhattan Associates' blowout quarter — a 28% single-day move. The stock never fully digested that rally. It is now down 3.3% over the past month.
The broader analyst picture remains constructive. Six analysts still rate the stock Buy, three Hold. Barclays holds Overweight with a $239 target. Baird sits at Outperform with $260. But the shift in tone from a previously bullish voice matters at this valuation level.
Short interest has climbed 27% over the past month to 5.4% of free float — its highest level in recent months. The weekly jump alone was 20%. That is a fast accumulation.
At 5.4%, the SI level is meaningful but not extreme. Days to cover stand at 4.99 per FINRA data. The ORTEX short score has risen from 39.4 on September 16 to 43.7 today — a steady grind higher across two weeks.
Cost to borrow remains low at 0.52%. The lending market is not under stress — availability sits at 1,508%, meaning there is ample supply of shares to borrow relative to what is already out on loan. Shorts are not being squeezed. They are entering with ease.
The put-call ratio tells a conflicting story. At 0.80, it sits 2.3 standard deviations below its 20-day mean of 0.98. That is a statistically sharp move toward calls. The PCR has dropped steadily from above 1.00 in early September to a fresh near-term low this week.
Options buyers are positioning bullishly even as short sellers build. One explanation: the earnings date. Manhattan Associates reports on October 20. The last quarter produced a 28% one-day rally. Options buyers may be positioning for a repeat. Short sellers may be hedging the downside risk from a stretched valuation — PE at 35x, EV/EBITDA at 26.7x, price-to-book above 40.
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