HPE has gained 35% in a month. Short sellers are exiting fast. But options traders are still buying protection.
That three-way split — covering shorts, loosening borrow, rising put demand — tells a nuanced story about where confidence actually sits heading into June earnings.
Short interest has dropped 10.6% in a single week to 4.6% of free float. Over the past month, it's fallen 23.5%. That's a significant unwind, and the borrow market confirms the trend: availability sits at 2,027% — more than 20 shares available to lend for every one currently borrowed. That's an exceptionally loose lending pool, one of the most open readings in the past year (the 52-week minimum availability was 550%).
The cost to borrow has crept up 12% over the week to 0.50%, but at that level it remains firmly low. The direction matters more than the level here: even as shorts cover, the marginal borrow is getting slightly more expensive — consistent with reduced short positioning rather than a genuine squeeze.
The cleaner story is in the options market. Even as shorts covered aggressively, put-call ratios surged. On May 14, the PCR hit 0.844 — 2.7 standard deviations above the 20-day mean. The following day it reached 0.85. Both readings were the highest in over three weeks.
The PCR has since eased to 0.669, still above the 20-day mean of 0.647. Options traders grew defensive into the rally. That's a hedge, not a short thesis — but it's a meaningful signal that not everyone is convinced the 35% move is fully justified.
The most striking single data point came from the analyst desk. On May 14 — the same day PCR was spiking — Citigroup's Asiya Merchant raised her price target on HPE from $27 to $39. The stock was trading around $33. A $39 target from a Buy-rated analyst at a major bank, arriving mid-rally, adds institutional credibility to the move that many options buyers appear to be questioning.
The mean analyst price target sits at $28.76. At $33.10, HPE is already trading above the consensus. Citigroup is now an outlier to the upside.
Capital Research and Management added over 21.9 million shares in the most recent reporting period — the largest institutional add among the top holders. Elliott Management built a 27.4 million share position. Both are meaningful votes of confidence from names that typically move with conviction.
Earnings land June 1. The past two prints produced muted reactions (-0.1% and +3.4% one-day moves), but HPE enters this one up 35% on the month. That's a much higher bar. The widening gap between where the stock trades and where consensus targets sit — combined with elevated options hedging demand — suggests the market is pricing in a strong print while simultaneously buying insurance against disappointment.
Data summary
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