To The Moon

I'm investigating the possibility of a short squeeze in HIMS$Hims & Hers Health Inc.(HIMS)$  this Monday. To gauge if momentum is building, I can use platforms like Ortex.com, which offers a proprietary estimate of live short interest, though it’s not exact. Alternatively, I must rely on the New York Stock Exchange’s bi-weekly short interest reports, delayed by 10-15 days. For instance, data from April 15th indicated 60 million shares shorted—33% of HIMS’ float—but by April 30th, it was already outdated.

For real-time signals, I’d track borrow fees on sites like Fintel or IBorrowDesk, which indicate shorting demand. Rising fees point to heavy shorting pressure, while a drop may suggest covering. Fail-to-deliver data provides additional clues, but these metrics are more indicative than precise. With limited transparency in short interest data, borrow fees stand out as the best real-time indicator.

Reflecting on past squeezes like GameStop four years ago, retail investors move quickly, sharing ideas with ease, but their buying power is limited. A sustained squeeze depends on institutional support. Retail can light the fuse, but institutions keep it burning. As a newer trader of high-short stocks, I’ve observed that retail’s influence is fast but fades without institutional involvement.

If a squeeze happens, how would I capitalize? I’d set a price target, secure most profits (about 80%) when it’s hit, and allocate the remaining 20% to far out-of-the-money call options as a FOMO hedge. This approach worked during HIMS’ February mini-squeeze, which I flagged in a post before it happened and later shared my profits from. Short interest dropped from 58 million to 46 million shares, driving a 100% price surge. However, shorts have since returned, pushing short interest back to 60 million shares.

Why HIMS? It’s perplexing. The company has posted eight straight quarters of positive free cash flow, skyrocketing revenue, and a management team that consistently beats expectations and raises guidance. Yet, it has the highest short interest in the S&P Midcap 400. Some mention litigation risks or less favorable Novo Nordisk licensing terms, but 33% short interest seems excessive. I’d assume shorts see something I don’t and remain cautious for risks like growth slowdowns or a potential scandal, though none have emerged.

Looking to May 5th, if HIMS reports stellar earnings, it could spark “Squeeze Part 2.” With 60 million shares short (33% of the float) and the stock at $40.82, the squeeze could be significant. GameStop’s second, quieter squeeze, with 20-30% short interest, delivered a 10X surge. For HIMS, I’d expect a larger move than February’s 100% gain—possibly 3-5X if momentum builds. Shorts may hold firm, but robust institutional buying could prolong the rally. Unlike GameStop, HIMS aligns more with Tesla or Palantir, where strong fundamentals and dedicated long-term investors supported post-squeeze prices.

Over the long term, a squeeze serves as free marketing. Soaring prices draw global attention, including from retail traders in Korea, where public stock ownership data fuels trading enthusiasm. For HIMS, a squeeze could attract new customers and investors, particularly if management avoids diluting shares at the peak, as they did before. Still, I’d stay rooted in fundamentals, targeting a $20 billion valuation (roughly 2.2X from now) as a practical near-term goal, then reassess based on growth and market conditions. HIMS is a core position for me, but I diversify across multiple portfolios to manage risk.

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