Ligand Pharmaceuticals (LGND) shorts are up $206 million in mark-to-market profits today after Citron Research published a report with a $35 price target on concentration of royalty payments in just four drugs, the largest of which will soon lose patent exclusivity. LGND was down 20% on the news today.
LGND shares shorted has increased by 569k, +8%, in 2019 even as LGNDâ€™s stock price declined 22% on the year. LGND short selling picked up in October 2018, with 3.7 million additional shares, +98%, shorted since October 2018.
Shorts are up $209 million in mark-to-market profits today, bringing year-to-date profits to $238 million, +23.54% on the year. Shorts held onto their positions in 2018 even as LGNDâ€™s three quarter long rally put them in a $544 million hole, -72%. LGNDâ€™s 4th quarter weakness turned 2018 into a profitable year for short sellers, ending up $94 million in mark-to-market profits, +12% for the year.
We are seeing continued short selling today, another 700k in short sales hitting the tape along with a large amount of long shareholder sales rushing out of their positions based on Citronâ€™s report. We should see continued share price weakness in the stock as momentum short sellers continue to jump into the fray and long-term long shareholders, who have already lost of half of their unrealized profits, try to exit their positions with a few shekels left in their pockets.
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