(Bloomberg) — The social media mafia took another hit, this time with a little-known software company that Wall Street had begun betting against.
The shares of Support.com Inc. skyrocketed Friday, adding to this week’s triple-digit rally as day traders praised the Los Angeles-based software company, whose platform helps companies manage technical and customer support.
Shares rose a whopping 118%, climbing to their highest level since 2004. Support.com was one of the most cited companies in Stocktwits over the past day and trading volume on Friday was over 400% of the three-month average.
Retailers took notice of Support.com last month after short bets piled against the company and interest in the stock appeared to have rekindled earlier this week. Support.com has won every session this week and is up over 300%. The rally added more than $600 million to the company’s market value, which is now over $850 million.
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Earlier this week, data collected by Vanda Research showed that Support.com was one of the most shorted stocks to see an acceleration in buying by retail – as opposed to professional – investors recently. Support.com’s outstanding short-term interest accounts for about 60% of the float, a measure of the stocks available for trading, according to data from S3 Partners.
“Short positions in stocks climbed earlier this month, but we’ve seen short coverage lately as the shorts are in a major tight spot,” said Ihor Dusaniwsky of S3 Partners. Investors betting against the company have seen $95 million in mark-to-market losses this year, with Friday’s surge showing “the pressure will continue and accelerate,” he said.
Support.com will hold an extraordinary general meeting on September 10 regarding the proposed merger with Bitcoin miner Greenidge Generation Holdings Inc.
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