It’s always good to be skeptical of anyone preaching about stocks with high short interest.
If you don’t really do your homework, you can get stuck holding the bag,
But I do not believe this is the case with $ATER.
Rabid Wall Street Bets posters noted an increase of over 33% in their short interest recently. Short interest is the number of shares that have been sold short but have not yet been covered or closed out. Short interest, which can be expressed as a number or percentage, is an indicator of market sentiment. Extremely high short interest shows investors are very pessimistic (potentially overly-pessimistic).
If enough retail investors take note of Aterian, short sellers will be forced to cover, close their puts, and the price will be driven up astronomically. There you have a very basic description of a short squeeze.
$ATER sported a utilization rate of 100% since the beginning of March. A full utilization rate implies there are no shares available to be shorted, meaning short sellers have to get more resourceful or get burned.
Considering the overall weakness of the stock market, $ATER probably got more attention than it would have on a strong day. Retail is looking for a place to park shares and continue getting reasonable returns for their p/l.
Keep an eye on $ATER this week for a potential runner.
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