Support.com Inc (NASDAQ: SPRT) and Vinco Ventures Inc (NASDAQ:BBIG) are up more than 200% in the past month due to increasing interest from retail investors.
Ihor Dusaniwsky, head of predictive analytics at S3 Partners, says a significant short squeeze in Support.com and Vinco Ventures may never happen, he said on CNBC on Wednesday.
Most people are familiar with the short squeezes that took place in GameStop Corp (NYSE: GME) and AMC Entertainment Holdings Inc (NYSE: AMC), which Dusaniwsky calls “OG meme stocks.”
The move starts with ‘act one’, meaning you buy incessantly, driving the stock price higher. This is followed by “act two,” in which short sellers hedge their positions, creating a short squeeze situation, Dusaniwsky said.
“We have the former in stocks like BBIG and SPRT, but unfortunately there isn’t enough short selling to have a big effect on the stock price.”
There are 6 million shares that are shorted in Support.com and 10 million shares are shorted in Vinco Ventures, he told CNBC.
Even if the short sellers hedge their positions, it won’t affect the stock price much because it’s such a small number of stocks compared to daily trading volume, Dusaniwsky said.
“I’m not saying there won’t be a short squeeze in these names, because that could very well be.”
Dusaniwsky told CNBC that the pressure just won’t be as great as the ones in GameStop and AMC Entertainment.
SPRT, BBIG Price Action: Support.com fell 23.96% to $23.85 on last check, while Vinco Ventures rose 9.57% to $8.93.
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