Daily Brief - Is this the next GME? (Jan 13, 2022)
GME rose to prominence as retail investors coordinated a ‘short squeeze’ against one of the most shorted stocks in the market at the time.
It appears that a new similar situation is emerging.
‘Beyond Meat has become one of the most shorted companies on the US stock market as investors fret over weaker sales and scepticism grows over the plant-based meat boom’, writes the FT.
42% of Beyond Meat’s outstanding shares are being shorted. By comparison GME in 2020 was 100%+ shorted (i.e on average each share had been lent and sold more than once!).
The thesis of the short sellers is that BYND has stopped being a growth stock. Meanwhile prices have more than halved.
The argument from the short sellers is that trading at 10x revenues when good consumer companies trade at 4x seems steep.
Maybe the times are not ready yet for a squeeze - the stock barely records in WSB stock tracker.
But things might change quickly, and one must always be on the lookout for that 10x bagger.