Bears Abandon Boston Scientific as Three Signals Converge

Why this matters: Three distinct ORTEX data signals have aligned on Boston Scientific within 48 hours — cost to borrow, short interest, and options sentiment. The convergence suggests a coordinated shift in trader positioning on the medical device maker.

Converging signals

Cost to borrow collapsed. Borrowing costs plunged 68% over the past week to just 0.14% APR, down from 0.50% on April 16. The sharp drop signals evaporating demand for short positions. When fewer traders want to borrow shares, lenders cut rates. The 0.14% level is the lowest since early April and down 59% from the month-ago reading of 0.34%.

Short interest retreated steadily. Short positions fell 11% over the past month to 23.3 million shares as of April 22. The decline accelerated in early April when shares shorted dropped from 25.7 million to 23.0 million in just eight trading days. Short interest now stands at 1.57% of free float. Days to cover sits at 1.43 based on recent average volume.

Options traders hedged aggressively. The put/call ratio spiked to 0.62 on April 21, jumping 54% above the 20-day average of 0.40. The move registered 2.9 standard deviations above normal levels. While short sellers exited, options traders piled into downside protection. The elevated PCR suggests some investors shifted from shorting shares to buying puts.

Historical parallel

This is not the first time BSX has seen short interest decline while options sentiment turned defensive. Similar divergences occurred in late March when utilization dropped from 0.73 to 0.40 over two weeks. That episode also saw cost to borrow swing erratically — from 0.21% to 0.45% and back to 0.22% within eight trading days.

Data summary

• Short interest: 23.3M shares, down 11% in 30 days
• Cost to borrow: 0.14% APR, down 68% in 7 days
• Put/call ratio: 0.62, up 54% vs 20-day mean
• Utilization: 64%, below 52-week high of 116%
• Price: $64.87, up 9% on April 22
• Earnings: Multiple events scheduled April 30

This is not financial advice. ORTEX data may contain inaccuracies.