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Galaxy Digital has lost another 6% this week to $21.40, and the short sellers who added through September's decline are showing no sign of covering.
Short interest has continued its patient grind higher, reaching 16.6% of the free float, about 31.9 million shares. That is up from 16.2% a week ago and up nearly 20% over the past month. What makes the positioning notable is the consistency: shorts have added in six of the last seven sessions, building through the stock's 19% one-month decline rather than banking gains. The FINRA fortnightly figure puts days-to-cover at 6.6, the same level cited in last week's note, so the mechanical overhang has not shrunk. The ORTEX short score has eased marginally to 69.6 from 68.4, though it remains in the bottom 5th percentile of the entire universe on short-score rank, confirming this is one of the more heavily shorted names in the market.
The borrow market, however, is not sending a squeeze signal. Availability has actually loosened slightly on the week, now running at 154%, meaning there are roughly three shares available to lend for every two already borrowed. The 52-week tightest reading was 44%, so the lending pool has considerable room before any mechanical pressure develops. Cost to borrow has drifted down to 0.64%, cheap by any standard, and the month-long rise in borrow cost of 26% has not translated into a structural tightening. Options positioning reinforces the same message: the put/call ratio is 0.51, modestly below its 20-day average of 0.55, roughly one standard deviation on the call-heavy side. Traders are not rushing to buy downside protection here, which sits oddly against the short-selling activity in the equity lending market.
The Street remains broadly constructive despite the price action. Most analysts carry Buy or Overweight ratings, and the mean price target of $40.38 implies roughly 89% upside from current levels. Morgan Stanley's James Faucette raised his target to $48 in early September, even as the stock was already fading, while Citigroup trimmed to $26 and holds Neutral, representing the cautious end of the range. The bull case centres on Galaxy's dual identity as a digital-assets platform and an emerging data-centre operator: the Helios buildout delivered its first data hall in April, and the company holds roughly $2.6 billion in cash and stablecoins. Bears point to the execution sensitivity of the power infrastructure ramp, heavy dependence on crypto prices and trading volumes, and competition from hyperscalers who could vertically integrate. The EV/EBITDA multiple has compressed about 6 points over the past month to roughly 30x, reflecting the price decline rather than any earnings upgrade. The 90-day EPS momentum factor scores in the 100th percentile, which captures the strong forward revision trend, but 30-day EPS momentum has fallen to the 6th percentile, pointing to a more recent stall in estimate upgrades.
One detail worth flagging in the ownership data: CEO Michael Novogratz holds 49.9% of the class as of his February 13G/A filing, down from 53.5% at the prior filing, a passive disclosure rather than an activist one. Capital Research Global Investors reported a 9.4% stake in February. FMR trimmed slightly to 9.2% as of August. BlackRock added 4.0 million shares in the quarter to June 30, reaching 5.1% of shares. These are large, relatively stable holders, and none has filed a 13D indicating activist intent. The insider trade log shows the CLO sold a small amount under a 10b5-1 plan in early September. The only discretionary open-market purchases in the recent record were two directors, Douglas Deason and Steven Bandrowczak, who each bought at prices around $19 to $21 in August.
The next scheduled earnings event is November 5. The last two prints produced first-day moves of minus 12% and minus 20%, so the setup into that date will be worth watching closely, particularly whether the short position has grown further or whether the stock's continued slide prompts any covering before the release.
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