LYFT shares are now down over 26% from their opening highs, having crashed well below their $72 IPO price as investors scramble to take profits (or reduce losses) on the cash-burning ride-share venture.
There is one little problem though – the shorts haven’t even started yet…
As Bloomberg reports, Ihor Dusaniwsky, managing director of predictive analytics at S3 Partners, blamed the drop on shareholders exiting the stock, rather than short sellers, because IPO shares aren’t finalized yet and therefore not in lending programs.
“It’s going to be interesting because you’ll have long holders that are already on the fence,” he said in an interview.
“If the shorts come in, they are going to push the longs out.”
“There’s going to be a ton of demand and not a lot of supply,” said Dusaniwsky, who expects the imbalance to result in borrow fees exceeding 10 percent, a level he called “very expensive.”
Short interest should steadily increase as more and more shares become available, and early indicators are pointing to strong demand from short sellers.
via ZeroHedge News https://ift.tt/2HUgDeO Tyler Durden