Summary

GPRO Stock: GoPro’s stock has faced weakness in the last couple of weeks and has hit fresh 52-week lows.

Shorts appear to be driving the stock downward, as short interest as a percentage of volume has steadily been increasing.

Institutional ownership has also declined, laying the foundation for a short squeeze scenario, which could cause GPRO to ratchet upwards if positive news is released.

GoPro’s (NASDAQ:GPRO) stock has fallen quite precipitously over the last week. However, there have not been any material changes that have led to this decline. The decline appears to be caused by Citi starting coverage with a sell rating, and a $8 price target, on Friday of last week. Then, on Monday, Goldman cut its rating on GPRO to sell and set a $6 price target. It appears that these reports have caused a rise in short selling, as a percentage of volume, which has caused the recent decline.

GPRO Chart

Short Interest Rising

Over the past couple of weeks, the percentage of volume of shares traded that were short sales has been increasing and nearly reached 30% of GPRO’s volume yesterday.

Although the overall percent of shares outstanding that were sold short has declined a bit over the past few months, hitting a high of roughly 36% in November, it still remains a staggering percentage of the total float, with 31% of shares sold short.

GPRO Percent of Float Short Chart

The article first appeared in seekingalpha.com