VELO just delivered its earnings print — and the immediate aftermath has flipped the positioning narrative that defined the run-in.
The headline shift is in short interest. Bears covered hard after the release. Short interest dropped roughly 19% in a single session on June 9, falling to 2.78 million shares — equivalent to 13.3% of the free float, down from 16.4% just days earlier. That's still a materially elevated short position by any standard, but the direction has reversed sharply. The week as a whole saw shorts reduce by about 17.5%, the most aggressive covering in at least six weeks. For context, short interest had been pinned stubbornly above 3.3 million shares through most of May and early June, so the move represents a genuine shift in conviction from the bear camp.
The lending market is telling the same story from a different angle. Availability has loosened meaningfully. It climbed to 74% on June 9 — up from a tight 36-41% range that prevailed from June 1 through June 4, and roughly double where it was at the start of last week. When shorts cover, borrow demand falls and availability loosens; the data tracks the covering pattern almost precisely. Cost to borrow remains modest at just over 4%, barely changed on the week, and well below the 10-12% range seen in late April. The 52-week availability low was 3%, touched when the borrow market was at its tightest; current conditions are nowhere near that extreme. Options positioning reflects a similarly relaxed stance — the put/call ratio of 0.46 is slightly above its 20-day average of 0.39, but only 0.87 standard deviations above it, well short of any meaningful defensive signal.
The Street picture remains thin. Only one firm — Lake Street — covers the stock actively. Analyst Jaeson Schmidt raised his target to $20 following the May 12 earnings print, maintaining a Buy rating. That target is now slightly below the current price of $19.43, which creates a somewhat awkward dynamic: the lone covering analyst is nominally bullish but his target has already been eclipsed by the stock's subsequent rally. The mean price target of $22.50 offers around 16% implied upside from current levels, though with a single analyst underpinning that figure, the number carries limited weight as a consensus signal. The ORTEX short score ticked down to 67.8 from 69.1 a week ago — still firmly in the bottom 3rd percentile of the universe, flagging VELO as one of the more heavily shorted names in the market even after the covering wave.
The most recent earnings reaction is worth noting. The May 12 print produced a 45% single-day move, with the stock giving back roughly 27 percentage points over the following five days. The June 9 session echoed that pattern in miniature — a 19.7% gain on the day, but the stock remains down 12% on the week, consistent with a sharp pop followed by partial mean-reversion. Today's earnings event (June 10) represents the formal catalyst window; the next scheduled print is August 7.
The ownership structure adds one layer of context. Arrayed Additive holds 42.7% of shares — a dominant, immovable anchor that compresses the freely tradeable float significantly. That concentration is part of why short interest as a percentage of float looks elevated even when absolute share counts are modest. Several institutional holders initiated or materially grew positions in Q1: Vanguard Capital Management, Millennium Management, and Tidal Investments all reported fresh entries as of March 31.
What to watch from here is whether the post-earnings covering wave continues through the week — or whether the residual 13% short interest finds fresh conviction if the stock fails to hold the $19-20 area.
See the live data behind this article on ORTEX.
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