Newell Brands finds itself in an unusual position this week: the stock has rocketed 35% higher while short sellers are quietly adding to their bets against it.
The price move is the headline number. NWL closed at $4.41 on Tuesday, up 35.3% on the week and 4.8% on the day. That's a sharp reversal for a stock that was down nearly 3% over the prior month. Yet the short interest data tells a different story beneath the surface — one where bears are not retreating.
Short sellers have been rebuilding positions into the rally. Short interest climbed to 10.8% of free float, up roughly 24% over the past month and up another 3.4% just this week, reaching 45.4 million shares. The official FINRA settlement figure from May 29 put short shares at 47 million, with days to cover at 7.05 — meaning it would take roughly seven full trading sessions to unwind the entire short book at recent volumes. That's a meaningful cushion for bears, but also a notable squeeze risk if the buying pressure continues. Borrow conditions offer little signal either way: the cost to borrow is just 0.41%, well within the "easy" range, and availability is loose at over 1,000% — roughly ten shares available to borrow for every one already lent out. There is no stress in the lending market. Options positioning is similarly calm, with the put/call ratio at 0.52, essentially flat with its 20-day average and nowhere near the defensive extremes seen earlier in the year.
The Street is cautious but not uniformly bearish. The consensus sits at Hold, with five analysts at that rating and one Sell. Morgan Stanley is the most recent voice of concern — in late May, Dara Mohsenian downgraded NWL to Underweight and cut the target to $3.50, making it the lone outright bear on the panel. Others have been more constructive since the May 1 earnings print: UBS and Citi both raised targets post-results (to $4.25 and $4.75 respectively), while Canaccord maintained a Buy with a $9.00 target. The mean target of $4.94 sits modestly above the current price, implying limited upside from here on consensus numbers. The bull case centres on tariff sourcing wins with over 30 customers, new product launches under the Coleman brand, and improving ROI on marketing spend. Bears point to a Q2 sales decline of 4.8% versus estimates, with the Outdoor and Recreation segment down 10.9% — worse than consensus — and ongoing softness in Learning and Development.
Institutional ownership adds some colour to the ownership picture. AQR added 6.3 million shares in Q1, and Marshall Wace added 6.5 million — both active managers building material new positions. Rubric Capital also added 2.3 million shares. On the insider side, the activity in recent weeks is mostly awards and small tax-related sells, with the exception of Chief Administration Officer Brad Turner, who sold 100,000 shares at $3.60 on May 22. That sale, worth $360,000, came before the current rally; at $4.41 it looks premature in hindsight, but it reflects the uncertainty executives were pricing in at the time. The ORTEX short score has eased from a peak of 64.1 on May 29 — when short interest was also elevated — to 55.4 now, consistent with the slight unwinding of squeeze dynamics over the past two weeks.
The next earnings event is July 27. The prior print on May 1 moved the stock 13% on the day and 11% over the five days that followed — so when NWL reports, it tends to move. With shorts sitting at nearly 11% of float, borrow cheap, and the stock already up 35% in a week without any obvious catalyst, the tension between the rebuilding short book and the price action is the dynamic most worth watching into that date.
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