Blue Apron Holdings, Inc. (NYSE: APRN) and Evofem Biosciences, Inc. (NASDAQ: EVFM) have been quickly climbing investors’ watchlists as an increasing short interest categorizes them as strong potential short-squeeze candidates. In this article, we analyze both stocks and their catalysts to determine if they could be profitable investments
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Short Squeeze Potential #1: APRN
Ever since Blue Apron Holdings, Inc. (NYSE: APRN) introduced its seasonal meal kit to the market early last month, the stock has rebounded from a two-year low. Additionally, the stock continues to stir talks of a potential short squeeze among Reddit investors given its high short interest rate. Currently, APRN has a high short interest rate representing almost 31.8% of its float. With only 150,000 shares available to short, it is no surprise APRN is quickly showing major short squeeze potential.
$APRN — headed much higher.
+105% past three weeks
0 shares available to short
32% short interest
51.56% borrow fee
1 bitch named Nathan Michaud
— Quinn (@Quinnvest) July 5, 2022
As a carbon-neutral meal-kit company, APRN has long focused on bringing incredible recipes to its customers. For a while now, the company has been experimenting with ways to grow its revenue. John Adler – the APRN’s VP of Culinary – previously highlighted APRN’s excitement to:
feature this limited-time, seasonal meal-kits on an ongoing basis to provide our customers with everything they need to make entertaining easier, with minimal effort.”
Now sold on Walmart’s website, Blue Apron’s new kit has been generating new buzz for the company after having struggled for the past 2 years to generate shareholder value. With the outbreak of COVID-19, the shift in consumer behavior urged more people to order takeout from food delivery services like DoorDash and Uber Eats – as many customers started to view meal kits as overpriced boxes of groceries.
With this in mind, despite having generated $795 million in revenue by 2016, the company experienced major losses as a result of this shift. Even with a 2% revenue growth to $470 million last year, APRN’s net loss increased immensely from $46 million to $88 million.
However, the future’s looking bright for APRN as CEO Lindley believes this new partnership with Walmart.com could be an “excellent way” to “introduce Blue Apron to new groups of customers who may not have considered a meal kit before.” With this in mind, the company plans on adding similar partnerships throughout the coming months in order to expand its direct-to-consumer business and stray away from its previous subscription-based model.
Let’s take a deeper look at this stock…
Following its recent run-up, APRN is currently trading at $4.79 with primary support at 3.57 and another at 2.68. The MACD is bullish to the upside and shows no signs of an incoming crossover. Similarly, the RSI is on an uptrend at 76 indicating APRN is slightly overbought but could continue its run-up soon.
Given that it is currently trading at its resistance, bullish investors could secure a starter position on APRN and continue adding to that position as the price goes up – if the short squeeze comes to life. Despite its high short interest, APRN could be a profitable investment in the long term given the company’s plans to form more solid partnerships in the coming months. Get alerts on APRN and other top penny stock runners here.
Short Squeeze Potential #2: EVFM
Since its inception, Evofem Biosciences, Inc., (Nasdaq: EVFM) is known for developing and commercializing innovative products that are meant to address unmet needs in women’s sexual and reproductive health. As of June 30th, the company’s first FDA-approved product, Phexxi lactic acid, citric acid, and potassium bitartrate), is a hormone-free, on-demand prescription contraceptive – that is expected to provide protection into at least 2033.
With this in mind, investors believed EVFM stands to benefit greatly from the Supreme court’s decision to overturn Roe v Wade – the 1970s ruling which recognized women’s right to undergo an abortion – driving a 200% increase in its PPS on June 27th. Given that 10 states have already moved to ban abortion, many are bullish Evofem’s non-hormonal birth control could be set for a surge in sales.
Saundra Pelletier – EVFM’s CEO believes this patent and the development of the product could pave the way for major growth for the company in the coming months.
This patent allowance is a clear nod to the innovation Phexxi brings to contraception and a woman’s ability to protect herself from unintended pregnancies.”
EVFM continues to climb up the Fintel Gamma Squeeze List and is now standing at number 1 with high short interest of 17% – positioning it as a strong short squeeze candidate.
— Will Meade (@realwillmeade) July 5, 2022
Let’s analyze the stock’s technical indicators…
Trading at $1.07, EVFM has resistance at 1.1166 and shows support at .903 and another at .3658. Accumulation has dropped significantly and continues to trend downwards while the MACD approaches a bearish crossover. The RSI is holding on near 52 – indicating the stock is currently stable to trade.
While these indicators show an overall bearish sentiment, EVFM could see a rebound very soon if the short squeeze actually happens. Given its high short interest, investors are bullish that the short squeeze could happen soon pushing the stock past its current resistance. Get alerts straight to your inbox & be the first to know the top penny stock gainers.
The stocks analyzed in this article could see major run-ups if the squeeze actually comes to life. Given their strong catalysts and overall investor sentiment, securing a position on these stocks could prove profitable in the short term and long term too. Sign up here for alerts on the best penny stock runners of the week!!
As always, good luck to all (except the shorts)!
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Disclosure: We have no business relationship with any company whose stock is mentioned in this video. Viral Stocks is not an investment advisor and this video does not provide investment advice. Always do your own research, make your own investment decisions, or consult with your nearest financial advisor. This video is not a solicitation or recommendation to buy, sell, or hold securities. This video is our opinion and is meant for informational and educational purposes only and does not provide investment advice. Past performance is not indicative of future performance.