Is a Giant Short Squeeze Brewing in PacWest (PACW) Stock?

  • Investors may have located their next short-squeeze target.
  • Short interest in struggling bank PacWest (PACW) is rising steadily.
  • The company could be about to experience the “Revlon effect.”
PACW stock - Is a Giant Short Squeeze Brewing in PacWest (PACW) Stock?

Source: T. Schneider /

PacWest Bancorp (NASDAQ:PACW) may be on the verge of being the market’s next short squeeze. It hasn’t been a good week for regional banks. Following the collapse and delisting of First Republic Bank, many similar companies have been struggling to regain investor confidence as market momentum pulls them down. PACW stock is down more than 40% for the week, but today it seems to be rebounding on short squeeze anticipation.

The bank holding company may be about to experience what has become known as the “Revlon phenomenon,” where retail investors double down on efforts to rescue a troubled company by turning it into a short squeeze play.

Does this mean that this is the time to load up on shares before the PacWest squeeze takes off? Let’s take a closer look at the company.

PACW Stock: The Next Short Squeeze?

This morning, PACW stock snapped its losing streak and started trending upward. As of this writing, it is up almost 3% for the day though its trajectory has been fairly volatile. Although it’s impossible to predict precisely where it will go from here, PACW’s price chart has been trending downward for much of the morning.

However, what is clear is that interest in the stock is rising. According to recent data from market analysis firm Fintel, the short interest percentage float is relatively high at 18.28%. The platform gives companies a short squeeze score, and PacWest’s is currently at 72.71 out of 100. PACW stock also boasts a gamma squeeze score of 49.60, just under the platform’s average of 50. Investors currently have 0.68 days to cover, with off-exchange short volume, which includes dark pool activity, currently sitting at 18,259,507 shares.

If this rising short interest is any indication, a short squeeze could indeed be brewing for PacWest. It’s also worth noting that interest in it has grown steadily across social media for the past 24 hours. According to data from ApeWisdom, mentions of PACW stock have surged 93% across popular investing forums, while the number of mentioning users has increased by more than 100%. The highest number, though, is that of its updates, which has skyrocketed by 903%. It received 95 mentions on r/WallStreetBets from 75 individual users, 41% of which were positive.

On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Samuel O’Brient has been covering financial markets and analyzing economic policy for three-plus years. His areas of expertise involve electric vehicle (EV) stocks, green energy and NFTs. O’Brient loves helping everyone understand the complexities of economics. He is ranked in the top 15% of stock pickers on TipRanks.

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