Star Group, L.P. heads into the aftermath of its fiscal Q2 print with short sellers having already bailed — and the numbers that just landed helping explain why.
The most striking move this week was a 19% single-session collapse in estimated short interest on May 5, the steepest one-day unwind on record for SGU. That brought shorts down to roughly 43,900 shares — a 22% drop on the week and 11% lower over the past month. The timing was deliberate: the earnings call was scheduled for May 7, and short sellers clearly chose not to carry the risk. ORTEX data flagged the move at the time, noting the stock was up 4.3% on the day as positions unwound. The short score has reflected the retreat, slipping from around 33 in late April to 29.8 by May 5 — still moderate, but falling.
Options positioning told a more cautious story heading in. The put/call ratio jumped to 1.92 on May 5, almost 2.7 standard deviations above its 20-day average of 1.45. That was the most defensively positioned reading in months — well above the year-to-date norm and pointing to meaningful demand for downside protection. Whether that represented hedging by existing holders or last-minute bearish bets, the options market looked braced for volatility. The borrow market, by contrast, offered little pressure: the cost to borrow has drifted down to 0.44%, 23% below where it was a month ago. Borrow availability is effectively unconstrained, with the availability reading above 1,900% — meaning shorts face no structural squeeze pressure at current positioning levels.
The earnings print itself arrived after the close on May 6. Q2 EPS came in at $2.66, up sharply from $2.01 a year earlier. Revenue hit $766.7M, ahead of the $743M recorded in the prior-year period. The numbers represent a meaningful beat in both lines — home heating fuel demand appears to have held up well through the quarter. At a trailing P/E of around 14x and an EV/EBITDA of roughly 4x, SGU trades at a modest valuation for a cash-generative utility. Return on equity runs at 46%, and the EBIT/interest cover ratio is over 13x, suggesting the balance sheet is in solid shape despite net debt of $337M. The stock closed at $12.87 on May 5, up just over 2% on the week and 8.7% year-to-date.
The ownership picture is relatively concentrated. Hartree Partners holds around 10% of shares outstanding, while Bandera Partners — the activist hedge fund — controls roughly 8.4%. Bandera sold 700,000 shares in May 2025 at $12.04, but still ranks as the second-largest holder. That overhang from a known seller is worth watching. Lubar & Co. added about 41,000 shares in Q1 2026, a modest but positive signal. Institutional holder count is limited at 61, which keeps the register fairly tight. The most recent director purchase — 15,000 shares bought at $11.79 in August 2025 — added relatively little in dollar terms but points in a constructive direction.
Peers in the gas utilities space were quieter on the week. NJR closed down 0.4% on the day and off 0.4% on the week; CPK fell 0.5% on the day and 1.3% on the week. SGU's positive performance looks idiosyncratic rather than sector-driven.
The focus now shifts to the May 7 conference call for any management commentary on volumes, operating costs, and the dividend. The quarterly payout was confirmed at $0.20 per unit for May — consistent with recent cadence. The ORTEX dividend score of 61 suggests the distribution is viewed as adequately supported, though the stale longer-run dividend history makes a trend read difficult. Whether the short-covering crowd reloads after hearing management's forward comments on winter demand will be the positioning story to track through the coming sessions.
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