A short squeeze forces investors betting on a stock's decline (short sellers) to buy back shares at a higher price to avoid losses, triggering a price surge.
South Korea extends ban on short selling until 2025 to crack down on illegal practices. Institutions like HSBC and BNP Paribas fined for naked shorting.
Beyond Meat Inc. (NASDAQ: BYND) shares are trading lower Tuesday afternoon after a New York Post article discussed a study linking processed foods, including vegan meat alternatives, to increased risk of heart disease.
Beyond Meat Inc (NASDAQ:BYND) and Plug Power Inc (NASDAQ:PLUG) shares are moving Monday morning in sympathy with GameStop Corp (NYSE:GME), which surged following a social media post from Keith Gill, also known as "Roaring Kitty."
Beyond Meat faces challenges as Carl's Jr. and Del Taco reportedly drop its plant-based beef due to declining sales. Most of Carl's Jr.'s 1,000+ locations stopped offering the Beyond Burger, initially launched in 2019. Del Taco also ceased Beyond Meat offerings in nearly 600 locations. Despite this, Beyond Meat is hopeful, banking on new product developments and pricing strategies to regain consumer interest.
In June of 2021, Beyond Meat had a market capitalization of just under $10 billion which has dropped to approximately $516 million at present. The stock has fallen nearly 90% since 2021. Beyond Meat shares are moving on heavy trading volume amid the rally with more than 11.45 million shares already traded in Tuesday's session, compared to the stock's 100-day average of 3.655 million shares.
A multitude of stocks with high short interest ripped higher on Monday and continue to rally on Tuesday. The initial moves higher appear to be due to retail traders rushing into heavily shorted names, but the continued momentum may have more to do with short covering.