The stock price of plant-based protein producer Beyond Meat (BYND.US) skyrocketed over 1,300% in four days, hitting a 14-month high during Wednesday's session and triggering intense battles among short sellers. According to data from S3 Partners LLC, this surge has expanded short sellers' paper losses by more than $120 million from last week's closing low, with cumulative losses for the year exceeding $45 million—just before the retail-driven rebound, shorts had nearly $80 million in paper profits for 2025.
The rapid surge from historic lows forced some short sellers to urgently cover their positions to limit losses. The stock closed down 1.1% on Wednesday after soaring as much as 112% during the session, and fell further by over 10% in after-hours trading to $3.20. Ihor Dusaniwsky, Managing Director of Predictive Analytics at S3 Partners, noted that short sellers are currently taking two approaches: those being squeezed are accelerating their short covering, while others, believing the rally is too high and too fast, are betting on an inevitable pullback and increasing their short positions. Although the short interest as a percentage of float has declined in recent sessions, it has still risen by over 5 million shares in the past 30 days, indicating heightened divergence.
The rally began last Friday and continued into Monday. On the news front, trader Demitri Semenikhin heavily promoted the stock on social media, employing tactics reminiscent of Keith Gill (aka Roaring Kitty), who fueled the GameStop (GME.US) surge during the COVID-19 pandemic. On Wednesday, Walmart announced it would expand the availability of Beyond Meat products to over 2,000 stores, further boosting the stock price.
Dusaniwsky compared the current scenario to the GameStop incident: some short sellers are being squeezed out, while others are doubling down on their short bets due to the rapid and excessive price surge. This meme stock frenzy, driven by retail investor attention, once again highlights the extreme volatility of distressed companies' stocks when flooded with short-term speculative capital. The diverging strategies within the short seller camp further underscore the market's growing polarization over highly valued assets.
