CRK Shorts Stay Firm as Analysts Turn Cautious Ahead of Thursday Print

Comstock Resources heads into its October 30 earnings release with a notably bearish analyst backdrop, a stock that has sharply rebounded from its lows, and a short book that has barely flinched despite the rally.

The clearest tension into the print is the divergence between price and positioning. The stock is up 14% over the past month to $14.90, and added another 4% on Tuesday alone. Yet short interest has moved in lockstep with the rally, not against it. At 8.7% of the free float, the short position has edged higher over the past week and month, suggesting bears are not capitulating into the strength. Borrowing costs remain low at 0.59%, so there is no mechanical squeeze pressure. Availability has tightened over the past week, dropping from around 83% to 60%, but that is still well within normal range for this stock. The ORTEX short score of 79.8, placing Comstock in the 1st percentile on short score rank among its peers, confirms the short community has meaningful conviction here.

Options positioning reads as the other side of that trade. The put/call ratio has fallen to 0.43, nearly 1.75 standard deviations below its 20-day average of 0.47 and close to its 52-week low of 0.34. Call activity is dominating at an unusual level. That points to a pocket of genuine bullish speculation heading into the print, even as short sellers hold firm. The two camps are more clearly opposed than the stock price alone would suggest.

Analysts have spent the past six weeks marking down their targets. Morgan Stanley cut to $13 from $15 on October 15, the same day Scotiabank initiated with a Sector Underperform rating and an $11 target. Mizuho trimmed its target to $17 from $20 on October 16, keeping a Neutral rating. The mean target now sits at $15.30, barely above the current price after the recent run. Goldman Sachs and UBS both carry Sell ratings. The bear case centres on the 6% cut to FY25 production guidance, with output guided to 1,275 mmcfe/d, well below where analysts had modelled. Bulls counter that the company is adding rigs, capital discipline has held, and the Haynesville position carries long-term resource upside if gas prices cooperate. With the stock having already clawed back much of its summer decline, the question of how much of that recovery is justified will dominate the reaction.

Ownership tells part of the story. Blue Star Exploration Company and Williston Drilling together control more than 70% of shares, meaning the genuine institutional float is thin. Among the institutional names with recent activity, Dimensional Fund Advisors added 415,000 shares and American Century added 401,000 shares in the quarter to September 30, modest but directionally constructive flows from two quantitative-leaning managers.

The print will test whether the operational headwinds that prompted the production guidance cut have stabilised, and whether Comstock can show any path toward the volumes the Street had expected earlier in the year.