These Growth Stocks Are Ripe For a Short Squeeze

• The screening methodology estimates short seller returns by tracking when positions were added over the past year and comparing entry prices to current levels
• Notable stocks identified include Nebius Group (NBIS), quantum computing firm D-Wave Quantum (QBTS), and drone company Blacksky Technology (BKSY)
• Growth stocks continue gaining despite heavy short interest, with semiconductor strength driving markets to new record highs

Market Summary: Growth Stocks Face Short Squeeze Potential

Key Findings

Growth stocks with significant short interest are showing elevated risk for short squeezes as markets continue reaching record highs, driven by strong semiconductor performance. Analysis based on the most recent reporting period (May 15, 2026) reveals short sellers may be facing substantial losses on recent positions.

Methodology

The screening process analyzed short interest reports over the past year to identify when short positions were added, using average prices from the prior two weeks to estimate entry points. This allows estimation of current losses for short sellers, indicating potential for forced covering.

Companies and Sectors Highlighted

Key names identified:

• Nebius Group (NBIS) - continuing to attract short interest
• D-Wave Quantum (QBTS) - quantum computing sector
• Blacksky Technology (BKSY) - drone sector

Sectors heavily targeted: Quantum computing and drone technology are experiencing particularly high short seller activity.

Market Implications

Despite ongoing market strength and new record highs, contrarians are advised to monitor names with "unwind potential" rather than positioning for a pullback. The combination of significant short positions and advancing stock prices creates conditions favorable for short squeezes, where forced covering could accelerate upward price momentum.

The concentration of shorts in growth stocks—particularly in emerging technology sectors like quantum computing and drones—suggests bearish sentiment persists in speculative names even as broader markets rally. Any continued strength in these positions could trigger cascading short covering, potentially amplifying gains beyond fundamental drivers.

Data note: Analysis reflects short interest as of the May 15 reporting period, published June 3, 2026.