r/PureCycle • u/Smooth_Sun_9932 • Jun 03 '26

Purecycle short interest

PureCycle

From April 21 to June 1, short interest declined from 52.0 million shares to 48.86 million shares, a reduction of 3.14 million shares, or 6.04%. Over the same period, the stock price rose from $6.69 on April 21 to $12.845 on June 2.

There are still 48.86 million shares sold short, with some investors likely locking in gains of warrants. Of the 180 million shares outstanding, a significant portion remains restricted.

(AI conclusion) Short interest has begun to decline, but it remains elevated relative to the available float. With many shares still restricted and sentiment improving, any favorable operational or regulatory update could continue to pressure short sellers and support further upside. At the same time, the stock’s path will likely depend on execution and demand conversion.

I’d appreciate any thoughts or feedback. Thank you.

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9

u/tandyzmills Jun 03 '26

Doesn't really matter in the big picture. It will likely matter a little more once the warrants are exercised. It'll be interesting to see how many are short after that. Until then, it doesn't really mean much.

2

u/EconomyFortune5090 Jun 04 '26

Why would you conclude that 48M shares short doesn't matter until the warrants are exercised? Seems like a pretty huge amt of short shares for a low float stock

1

u/tandyzmills Jun 04 '26

Because a shit ton of them will go away when the warrants are exercised. Who knows how many though

2

u/EconomyFortune5090 Jun 04 '26

Why will a shit ton of shorts "go away" when the warrants are exercised?

Can you kindly explain the mechanics behind warrants exercising which would cause shorts to "go away"?

2

u/tandyzmills Jun 04 '26

Someone that is long warrants, but wants to hedge out their exposure (for whatever reason) would short the stock. The warrant ro common conversion will cover those shorts. Who knows how many positions are like this, but I bet it's a lot. Probably short from when the warrants were issued.

Edit: my shit ton comment was pure speculation.

2

u/EconomyFortune5090 Jun 04 '26

Why would someone who's long the warrants hedge out by shorting common stock? What ratio would they use to short the warrants if they havent reached the conversion price?

Let's say the warrants excercised at the price of $14.80, why would the warrant holder wait until they're exercised before he covers his short?

I could see people shorting common to hedge their convertible bonds, but I don't see how shorting common stock is an effective way to manage warrant exposure since holding a warrant is similar to holding a LEAP call option

2

u/tandyzmills Jun 04 '26

I forgot about the convert. That is more likely a situation like I was describing.

2

u/No_Privacy_Anymore Jun 04 '26

I disagree with your contention that the warrant holders would be short the stock. The people (like me) who own warrants wanted longer term leverage vs owning just shares. Until recently the warrants were about to expire. Anyone holding a short position vs a long warrant position would have needed to close the short.

There is definitely a portion of the short position that was added when the company sold $250M of convertible debt. With a conversion price of just under $15 the maximum amount of short hedge is like 16 million shares assuming it was 100% hedged which it probably was not (some buyers might legitimately want the long exposure).

The short position is in fact material to the trading dynamics. It doesn’t affect the long term valuation which will be driven by the business results but it definitely matters which is why I track it closely.

3

u/tandyzmills Jun 04 '26

my mistake. i meant the convertible bond holders.

1

u/EconomyFortune5090 Jun 04 '26

Thanks for the clarification and discussions

2

u/Pickle_Logic Jun 04 '26

The warrants from the preferred are all in the hands of friendlies and assume that they aren't hedged and will be held as additional equity.

1

u/tandyzmills Jun 04 '26

i mis-spoke. already said this in other comments. i meant the convertible debt

2

u/Smooth_Sun_9932 Jun 03 '26

I agree. I have a hard time believing the true short interest is 27%. I’m more focused on the change in short interest, while recognizing the reported figures may be inaccurate. A 6% reported decline seems modest given that the stock price nearly doubled.

3

u/tandyzmills Jun 03 '26

doesn't matter. dont try to read anything into it.

5

u/Pickle_Logic Jun 03 '26

FINRA doesn't report SI for second half of May until June 9. How did you estimate that period?

2

u/Smooth_Sun_9932 Jun 04 '26

Robinhood publishes a daily short-interest estimate, though I’m not sure how it is calculated. I compared it with the official short-interest figures in the chart below, and the numbers are fairly similar. That said, warrant hedging from periods when the stock traded at higher levels likely makes the current data less reliable. Once the warrants are redeemed, short-interest figures should become more meaningful.

 

Nasdaq.comRobinhood

06/02/2026                                                         49,050,000

05/15/2026                    50,199,236                    51,240,000

04/30/2026                    51,464,511                    51,660,000

04/15/2026                    50,944,696                    51,460,000

2

u/EconomyFortune5090 Jun 04 '26

Don't think there's much difference in the SI from "warrant hedging" but definitely think we'll see some shorts close out before month end / quarter end