Weight Watchers (WTW) short interest is $298 million; 10.07 million shares shorted; 21.84% of float; stock borrow cost is Â 0.30% fee.
WTW is down 35% in late morning trading as the company missed analyst estimates for 4th quarter earnings ($0.46 vs $0.60) and sales ($330 million vs $347 million) as well as 2019 expected revenues ($1.4 billion vs $1.7 billion) and profits ($1.25 to $1.50 per share vs $3.36 per share).
Short sellers have dramatically increased their short exposure in Weight Watchers in 2019, with shares shorted increasing by 5.8 million shares, +135%, in 2019 with most of the increase occurring in the first two weeks of January. February has actually seen a small amount of short covering, -289k shares, but we had seen a small bump in short selling this week, +96k shares or +1%, and a surge of short selling today, over 500k shares, in response to WTWâ€™s price drop.
Short sellers were already up $73 million in mark-to-market profits year-to-date prior to todayâ€™s trading with the stock dropping 33% through February 26th. Todayâ€™s 34% drop generated another $100 million of mark-to-mark profits for short sellers, bringing year-to-date short profits to $173 million, +57%.
If WTWâ€™s stock price continues to show weakness, we will see more short selling in the stock.
Want deeper insight into the above analysis?
Contact:Â [email protected]
Â Â Â Â Â Â Â Â Â Managing Director Predictive Analytics, S3 Partners, LLC
For more information on S3â€™s reporting, data and analytics solutions, email us at [email protected]. Start your free trial of the BLACK App â€“ the only source of real-time short interest on the Bloomberg Terminal or Thomson Reuters Eikon.
For short side data and access to our research reports go to https://shortsight.com/ .
The information herein (some of which has been obtained from third party sources without verification) is believed by S3 Partners, LLC (â€śS3 Partnersâ€ť) to be reliable and accurate.Â Neither S3 Partners nor any of its affiliates makes any representation as to the accuracy or completeness of the information herein or accepts liability arising from its use.Â Prior to making any decisions based on the information herein, you should determine, without reliance upon S3 Partners, the economic risks and merits, as well as the legal, tax, accounting and investment consequences, of such decisions.