The GameStop short squeeze and stock bonanza might have felt like a once-a-decade or once-in-a-lifetime event, but Goldman Sachs says it could happen again, and soon.
Even if there were many ways the social media-fueled frenzy in GameStop and AMC Networks and Bed Bath & Beyond was unique, many of its most notable ingredients are still there, according to Goldman Sachs. Chief among them are these two: There are a lot of big short bets on the market, and retail investors still have a ton of money.
While short bets against the average stock are low and hedge funds are dumping exposure, Goldman Chief US Equity Strategist David Kostin says there are still huge bets against specific stocks — including GameStop and its recent short-squeeze peers.
"In the last three months, a basket containing the 50 Russell 3000 stocks with market caps above $1 billion and the largest short interest as a share of float has rallied by 98%," Kostin wrote in a research note published January 29.
He says that's unmatched in any other period. And while shorts against the average Russell 3000 stock are small — Kostin says the average short interest as a percentage of the total share float is only 3% — the heavily-shorted stocks can still blow up, and it would cause hedge funds just as much pain as it did in January.
"In recent years elevated crowding, low turnover, and high concentration have been consistent patterns, boosting the risk that one fund's unwind could snowball through the market," he wrote.
Meanwhile, Kostin says retail investors have a ton of money they could invest, in news the members of r/Wallstreetbets might be happy to hear.
"More than 50% of the $5 trillion in money market mutual funds is owned by households and is $1 trillion greater than before the pandemic," he wrote. "Regulatory actions, broker risk limits, or unexpected losses could all dampen the activity ... But otherwise, an abundance of US household cash should continue to fuel the trading boom."
Now that everyone is aware of the hidden potential in heavily shorted stocks, Kostin is identifying the biggest short interest targets on the market.
The 40 stocks listed here had the largest bets against them of any Russell 3000 stocks as of January 29. They're ranked from lowest to highest based on the short interest as a percentage of their overall share float.
40. OPKO Health
Ticker: OPK
Sector: Healthcare
Market cap: $3.8 billion
Short interest as of January 29: 25%
Source: Goldman Sachs
39. vTv Therapeutics
Ticker: VTVT
Sector: Healthcare
Market cap: $130 million
Short interest as of January 29: 25%
Source: Goldman Sachs
38. B&G Foods
Ticker: BGS
Sector: Consumer staples
Market cap: $3.1 billion
Short interest as of January 29: 25%
Source: Goldman Sachs
37. BigCommerce Holdings
Ticker: BIGC
Sector: Information technology
Market cap: $4.9 billion
Short interest as of January 29: 26%
Source: Goldman Sachs
36. Alpha Pro Tech
Ticker: APT
Sector: Industrials
Market cap: $257 million
Short interest as of January 29: 26%
Source: Goldman Sachs
35. Tabula Rasa Healthcare
Ticker: TRHC
Sector: Healthcare
Market cap: $1.3 billion
Short interest as of January 29: 26%
Source: Goldman Sachs
34. Kaleido Biosciences
Ticker: KLDO
Sector: Healthcare
Market cap: $454 million
Short interest as of January 29: 26%
Source: Goldman Sachs
33. TherapeuticsMD
Ticker: TXMD
Sector: Healthcare
Market cap: $650 million
Short interest as of January 29: 26%
Source: Goldman Sachs
32. Madrigal Pharmaceuticals
Ticker: MDGL
Sector: Healthcare
Market cap: $1.9 billion
Short interest as of January 29: 26%
Source: Goldman Sachs
31. Inovio Pharmaceuticals
Ticker: INO
Sector: Healthcare
Market cap: $2.7 billion
Short interest as of January 29: 26%
Source: Goldman Sachs
30. Continental Resources
Ticker: CLR
Sector: Energy
Market cap: $8.4 billion
Short interest as of January 29: 26%
Source: Goldman Sachs
29. BioXcel Therapeutics
Ticker: BTAI
Sector: Healthcare
Market cap: $1.5 billion
Short interest as of January 29: 27%
Source: Goldman Sachs
28. Bed Bath & Beyond
Ticker: BBBY
Sector: Consumer discretionary
Market cap: $3.5 billion
Short interest as of January 29: 27%
Source: Goldman Sachs
27. PetMed Express
Ticker: PETS
Sector: Consumer discretionary
Market cap: $708 million
Short interest as of January 29: 27%
Source: Goldman Sachs
26. Buckle
Ticker: BKE
Sector: Consumer discretionary
Market cap: $2.0 billion
Short interest as of January 29: 27%
Source: Goldman Sachs
25. Revlon
Ticker: REV
Sector: Consumer staples
Market cap: $595 million
Short interest as of January 29: 28%
Source: Goldman Sachs
24. Vaxart
Ticker: VXRT
Sector: Healthcare
Market cap: $922 million
Short interest as of January 29: 28%
Source: Goldman Sachs
23. Seritage Growth Properties
Ticker: SRG
Sector: Real estate
Market cap: $759 million
Short interest as of January 29: 28%
Source: Goldman Sachs
22. Intercept Pharmaceuticals
Ticker: ICPT
Sector: Healthcare
Market cap: $1.1 billion
Short interest as of January 29: 28%
Source: Goldman Sachs
21. Fulgent Genetics
Ticker: FLGT
Sector: Healthcare
Market cap: $4.2 billion
Short interest as of January 29: 30%
Source: Goldman Sachs
20. Retractable Technologies
Ticker: RVP
Sector: Healthcare
Market cap: $583 million
Short interest as of January 29: 30%
Source: Goldman Sachs
19. Tootsie Roll Industries
Ticker: TR
Sector: Consumer staples
Market cap: $2.1 billion
Short interest as of January 29: 31%
Source: Goldman Sachs
18. Discovery
Ticker: DISCA
Sector: Communication services
Market cap: $22.9 billion
Short interest as of January 29: 31%
Source: Goldman Sachs
17. Zynex
Ticker: ZYXI
Sector: Healthcare
Market cap: $677 million
Short interest as of January 29: 31%
Source: Goldman Sachs
16. Rocket Companies
Ticker: RKT
Sector: Financials
Market cap: $40.8 billion
Short interest as of January 29: 31%
Source: Goldman Sachs
15. Ontrak
Ticker: OTRK
Sector: Healthcare
Market cap: $1.6 billion
Short interest as of January 29: 32%
Source: Goldman Sachs
14. SunPower
Ticker: SPWR
Sector: Information technology
Market cap: $8.4 billion
Short interest as of January 29: 32%
Source: Goldman Sachs
13. Marcus
Ticker: MCS
Sector: Communication services
Market cap: $532 million
Short interest as of January 29: 32%
Source: Goldman Sachs
12. AMC Networks
Ticker: AMCX
Sector: Communication services
Market cap: $2.0 billion
Short interest as of January 29: 33%
Source: Goldman Sachs
11. Precigen
Ticker: PGEN
Sector: Healthcare
Market cap: $1.8 billion
Short interest as of January 29: 33%
Source: Goldman Sachs
10. National Beverage
Ticker: FIZZ
Sector: Consumer staples
Market cap: $5.5 billion
Short interest as of January 29: 35%
Source: Goldman Sachs
9. Accelerate Diagnostics
Ticker: AXDX
Sector: Healthcare
Market cap: $750 million
Short interest as of January 29: 36%
Source: Goldman Sachs
8. Esperion Therapeutics
Ticker: ESPR
Sector: Healthcare
Market cap: $896 million
Short interest as of January 29: 38%
Source: Goldman Sachs
7. Ligand Pharmaceuticals
Ticker: LGND
Sector: Healthcare
Market cap: $3.4 billion
Short interest as of January 29: 39%
Source: Goldman Sachs
6. Tanger Factory Outlet Centers
Ticker: SKT
Sector: Real estate
Market cap: $1.4 billion
Short interest as of January 29: 41%
Source: Goldman Sachs
5. International Flavors & Fragrances
Ticker: IFF
Sector: Materials
Market cap: $33.7 billion
Short interest as of January 29: 41%
Source: Goldman Sachs
4. Clovis Oncology
Ticker: CLVS
Sector: Healthcare
Market cap: $842 million
Short interest as of January 29: 42%
Source: Goldman Sachs
3. GameStop
Ticker: GME
Sector: Consumer discretionary
Market cap: $3.6 billion
Short interest as of January 29: 43%
Source: Goldman Sachs
2. Gogo
Ticker: GOGO
Sector: Communication services
Market cap: $1.2 billion
Short interest as of January 29: 43%
Source: Goldman Sachs
1. Academy Sports and Outdoors
Ticker: ASO
Sector: Consumer discretionary
Market cap: $2.3 billion
Short interest as of January 29: 46%
Source: Goldman Sachs