CVBF shorts retreat as options flip bullish

CVB Financial Corp. ends April with a strikingly different short profile than it had three weeks ago — and options traders have swung from extreme defensiveness to the most bullish positioning of the past year, all while the stock quietly adds 8% over the month.

Short sellers have been aggressively covering. SI hit 11% of free float on April 20 — the highest level in the 30-day window — and has since fallen to 6.5%, a drop of more than 40% on the week. The FINRA fortnightly print, which captures activity through April 15, still shows 10.4 million shares short with days-to-cover near 8 days, confirming the elevated base that shorts have been unwinding from. Availability in the lending market has loosened considerably as a result: utilization (the share of available stock already lent out) has fallen from 19.8% — its 52-week peak, hit on April 1 — to just 6.8%, suggesting the borrow market is now comfortably supplied. Cost to borrow followed a similar arc, spiking to 0.90% in mid-week before pulling back to 0.61% by Tuesday's close.

Options tell a different story entirely. The put/call ratio collapsed to 0.10 on April 28 — the lowest reading of the past 52 weeks, against a 20-day average above 5.0, and nearly three standard deviations below that mean. For most of April, options flow had been running heavily put-dominated; Tuesday's session saw a dramatic rotation into calls. This is the year's most bullish single-day options reading for CVBF, and it arrived on the same day shorts covered hard — a convergence worth noting.

On the Street, the tone is cautiously constructive. Piper Sandler raised its target to $27 on April 27, maintaining an Overweight rating — the most recent analyst action and a modest step-up from the prior $26 target. The mean price target across covering analysts runs to $24.00, implying around 17% upside from the current $20.49 close. Bulls point to improving NIM, higher EPS estimates for 2025 and 2026, and disciplined cost management. Bears flag a 9% quarter-on-quarter decline in core noninterest income and ongoing pressure on loan and deposit pricing. The P/E multiple runs at 11.8x — up roughly 0.6x over the past 30 days — while P/B has expanded to 1.10x. The 90-day EPS momentum factor score of 75 puts the company in the upper quartile on earnings trajectory.

The ownership structure is stable and index-heavy. BlackRock holds 14.1% of shares, Vanguard 10.8%, and Dimensional 5.4% — all adding modestly at the March quarter-end. The most notable move belongs to FMR (Fidelity), which added 885,000 shares through February. Insider activity through late March was routine: the March 16 cycle saw equity award grants to the CEO, CFO, and COO alongside tax-related sell transactions, netting to a positive 64,000 shares over the 90-day window, with zero large discretionary open-market sells.

The next earnings event is scheduled for May 20. After last quarter's Q4 print, the stock fell 4.3% on the day and an additional 0.6% over the following week. The short score has dropped sharply this week — from 62.9 on April 20 to 46.4 on April 28 — tracking the covering activity in near real-time. What the May print will determine is whether the short rebuilding episode of early April was a structural re-rating of credit concerns or simply a macro-driven momentum trade that has now fully unwound.