Tupperware Brands (TUP:US) stock has enjoyed a huge rally recently. Over the last month, the stock has surged nearly 400% thanks to interest from retail investors.
As a result of this share price spike, the stock has attracted attention from short sellers. With that in mind, here’s a look at the latest short interest data on Tupperware Brands.
Rising Short Interest
Over the last month, the number of Tupperware shares on loan has climbed significantly. Today, there are 14.2 million shares on loan, up from 6.1 million a month ago. This increase of approximately 134% indicates that the short sellers have been ramping up their short bets significantly.
After the recent increase in shares on loan, Tupperware’s short interest is very high. Currently, it stands at 36.87. Utilization is 100%, which indicates that the short sellers are shorting every share they can get their hands on.
It’s not hard to see why the short sellers see share price downside here.
Back in April, Tupperware Brands said that it had “substantial doubt” in relation to its ability to continue as a going concern and warned of a possible bankruptcy.
At the time, the company had around $700 million in debt, and it was struggling to compete with cheaper competitors selling similar goods on Amazon.
More recently, the shares took a hit in May after the company said that it found prior-period misstatements and material weaknesses in internal controls in its financial reporting.
What’s Next For Tupperware Brands Stock?
As for where Tupperware Brands stock will go from here, it’s hard to know.
With short interest of 36%, there is potential for a short squeeze. This could push the stock higher. That said, the days-to-cover ratio is only 0.3, meaning that short sellers could get out of the stock quite quickly.
However, there is also potential for a drop in the share price. With the stock up nearly 400% over the last month, we could see a pullback as traders take profits. We could also see a significant fall if the company files for bankruptcy.
Given the risks, we think investors need to be careful with this stock.