Safe Pro Group Inc., the small-cap aerospace and defense firm, heads into the week with a notable divergence: short sellers have been cutting positions hard even as the stock drifts only modestly off its recent highs.
Short interest has collapsed over the past month — down 61% to just 1.3% of the free float — and the sharpest move came this week itself, with a 34% reduction in estimated short shares. That's not a gradual unwind; it's an exit. Borrow conditions tell a parallel story. Cost to borrow has eased from around 9% in early April to 7.5% now, and availability has loosened materially as borrowing demand has dropped. The ORTEX short score slipped from 55 to under 50 in a single session on May 14 — its lowest reading in the current history — confirming the de-crowding in real time.
The options picture has been volatile but is also cooling. Put/call ratios were running at extreme levels — 48 as recently as May 8 — before collapsing to 9.7 by May 15. These are thin-market readings on a micro-cap name with limited open interest, so context matters. But the direction of travel is clear: the most defensive positioning of the past several weeks has unwound sharply. The 52-week PCR high is 54, so even the earlier extreme readings were approaching that ceiling; now the market is well off those levels.
EPS momentum is the standout fundamental signal here. The factor scores rank SPAI in the 80th percentile on 30-day EPS momentum and the 85th percentile on 90-day EPS momentum. Forward earnings estimates have been moving higher, with 12-month forward EPS growth ranking in the 84th percentile year-on-year. For a stock trading at a P/E of roughly 16x, that combination is what's drawing attention. Analyst coverage remains thin and dated — three initiation calls from smaller firms, the most recent from Lake Street in November 2025 with a $9 target — all stale relative to today's $4.35 price. The mean target of $10.67 implies large implied upside, but with coverage this sparse and dated, that number carries little weight as a near-term signal.
The ownership structure is worth noting. Founder and CEO Daniyel Erdberg holds just under 23% of shares, but trimmed ~48,000 shares at $4.99 in March, following a 120,000-share sale at $4.15 in December. CFO Theresa Carlise also sold ~19,000 shares in the same March filing. Neither sale is enormous in absolute terms, but the pattern — two executives both reducing around current price levels — is a data point. Vanguard added 171,000 shares in Q1, Perkins Capital initiated a 231,000-share position in Q1, and Davidson Kempner entered with 751,000 shares at year-end 2025. Institutional accumulation at the same prices where insiders are trimming creates a useful tension to watch.
Peers have had a rougher week. KTOS fell 10%, RCAT dropped 8.5%, and AIRO gave back 13% — making SPAI's 5% weekly gain look notably resilient. With the stock due to report full-year 2025 results and short sellers largely having stepped aside, the next concrete test is how well the earnings momentum story holds up against actual numbers.
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