BGFV's short interest is growing despite great fundamentals

Recent BGFV Stock Price Action: Back on November 11th 2021, BGFV reach a high of $47/share, however, since then the stock has gradually fell to a current price of $16/share. Since the beginning of the year, BGFV stock price has dropped by over 15%. It is very evident that their stock price is in a downtrend, but is there any actual reason for this to be happening? BGFV Recent Earnings: On March 1st, 2022, BGFV reported their Q4 2021 earnings. Based off of their recent stock price movement, you might think that their earnings were a bust. However, it was quite the opposite as they beat their EPS by a little over 4%. Furthermore, BGFV declared a dividend of $0.25/share which is consistent with their previous 2 dividend payments. However, the bigger piece of news is the fact that they authorized a new share buyback program for up to $25M set aside to repurchase shares. BGFV Stock Price Estimate: Back in January, one Utradea user posted a very in-depth position on BGFV. This user concluded that BGFV should be worth $40/share at fair value. This seems very plausible given that their current p/e ratio is a little over 3. This estimate is far above the average analyst price target of $25.50/share. If you are interested in reading this analysis, it can be found here. BGFV Short Interest: Recently, there has been additional attention being paid to BGFV Stock as the BGFV short interest has skyrocketed over the past couple of weeks. Naturally, this united users from the BGFV StockTwits, BGFV Reddit, and BGFV Twitter communities to take note of the stock and start to post content about the stock. Currently (according to Fintel), the BGFV short interest is at 39%, and a short borrowing rate of 15.48%. Currently, there are 12.76 days to cover, so it is unlikely that we see a massive squeeze in the coming days, but the short data for this stock is definitely something to pay attention to. With the BGFV short interest of 39%, they are currently the 5th most shorted stock on the market (behind $INDO, $LFLY, $GTLB, and $FUV). Overall Thoughts: I think that BGFV is a great company, that has continually performed well since the beginning of the pandemic. Furthermore, they offer an attractive dividend (that has been growing as they perform well), are committed to a large share buyback program, and have offered special dividends to force shorts to cover and reward their investors. I think that the recent spike in short interest gives you all the more reason to buy and hold this value stock. Hopefully, we see more people get on board and squeeze this stock back up above the $20, and maybe even the $30 range.

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BGFV's short interest is growing despite great fundamentals

bullish

Recent BGFV Stock Price Action:

Back on November 11th 2021, BGFV reach a high of $47/share, however, since then the stock has gradually fell to a current price of $16/share. Since the beginning of the year, BGFV stock price has dropped by over 15%.

It is very evident that their stock price is in a downtrend, but is there any actual reason for this to be happening?

BGFV Recent Earnings:

On March 1st, 2022, BGFV reported their Q4 2021 earnings. Based off of their recent stock price movement, you might think that their earnings were a bust. However, it was quite the opposite as they beat their EPS by a little over 4%.

Furthermore, BGFV declared a dividend of $0.25/share which is consistent with their previous 2 dividend payments. However, the bigger piece of news is the fact that they authorized a new share buyback program for up to $25M set aside to repurchase shares.

BGFV Stock Price Estimate:

Back in January, one Utradea user posted a very in-depth position on BGFV. This user concluded that BGFV should be worth $40/share at fair value. This seems very plausible given that their current p/e ratio is a little over 3. This estimate is far above the average analyst price target of $25.50/share. If you are interested in reading this analysis, it can be found here.

BGFV Short Interest:

Recently, there has been additional attention being paid to BGFV Stock as the BGFV short interest has skyrocketed over the past couple of weeks. Naturally, this united users from the BGFV StockTwits, BGFV Reddit, and BGFV Twitter communities to take note of the stock and start to post content about the stock.

Currently (according to Fintel), the BGFV short interest is at 39%, and a short borrowing rate of 15.48%. Currently, there are 12.76 days to cover, so it is unlikely that we see a massive squeeze in the coming days, but the short data for this stock is definitely something to pay attention to. With the BGFV short interest of 39%, they are currently the 5th most shorted stock on the market (behind $INDO, $LFLY, $GTLB, and $FUV).

Overall Thoughts:

I think that BGFV is a great company, that has continually performed well since the beginning of the pandemic. Furthermore, they offer an attractive dividend (that has been growing as they perform well), are committed to a large share buyback program, and have offered special dividends to force shorts to cover and reward their investors.

I think that the recent spike in short interest gives you all the more reason to buy and hold this value stock. Hopefully, we see more people get on board and squeeze this stock back up above the $20, and maybe even the $30 range.

read-time
2 min
25.00
Target Price
9/ 10
Confidence
2-6 Months
Timeframe
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Earnings Per Share
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Financials
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Management
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Price to Earnings Ratio
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Dividend
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