Ondas Inc. has surged 49% in a week. The borrow market remains completely locked. Options traders are the most bullish they've been in a year. Something has to give.
The picture has shifted materially since the May 27 note. Short interest has pulled back — from 46.7% of float then to 43.0% now — suggesting some covering into the rally. Yet availability remains pinned at 0%. Every share in the lending pool is still on loan. The cost to borrow has climbed to 1.83%, up 71% over the past week, reflecting the strain of that locked supply against a stock that keeps moving higher.
Availability has been at 0% for more than two weeks without interruption. The last time any slack appeared was mid-May, when availability briefly touched 17% before collapsing entirely around May 19. Since then, nothing. With short interest at 43% of the free float and no shares left to borrow, new shorts cannot be established through normal channels. That structural constraint is now coinciding with a sharply rising stock price — an uncomfortable combination for anyone holding a short position they cannot add to or easily replace.
Cost to borrow at 1.83% is not extreme in absolute terms, but the pace of increase matters. It has risen from 1.07% on May 22 to 1.83% today — a 71% climb in one week. That acceleration reflects increased competition for a fixed pool of borrowable shares.
The put/call ratio has dropped to 0.46. That is 2.6 standard deviations below the 20-day mean of 0.50. It is the most call-heavy reading in a year, and it has continued drifting lower even as the stock ran 49% on the week. This is not new hedging activity offsetting gains. Calls are being bought into strength.
The ORTEX short score sits at 69.0 — elevated, though it has eased slightly from the 69.5 peak on May 26. The short score rank stands at the 2nd percentile of all stocks, meaning almost no other name in the universe carries a more bearish lending-market profile.
Needham reiterated its Buy rating on May 19 with a $23 target — still 71% above the current price of $13.46. Northland Capital Markets holds an Outperform with an $18 target. The mean analyst target across coverage is $20.13. With the stock at $13.46, the gap to consensus has narrowed significantly after the weekly run, but upside to targets remains wide. Next earnings are not until August 14.
The gap between what options traders are pricing and what the borrow market is signalling has rarely been wider for this name. Watch whether covering continues to ease availability, or whether the borrow squeeze persists even as the price climbs.
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