Novavax $NVAX Faces Potential Short Squeeze with 35% Shares Shorted as of July 2025

The biotech sector often serves as a battleground for speculative trading, and Novavax, Inc. (NVAX) currently stands at the centre of such dynamics. With a substantial portion of its shares sold short, the stock presents a compelling case for potential volatility, driven by the risk of a short squeeze. Recent data indicates that approximately 35% of the company’s float is held in short positions, with a days-to-cover ratio of around nine, suggesting a heightened tension between bearish and bullish forces in the market as of July 2025. This situation, noted in passing by some market observers on platforms like X under handles such as ACInvestorBlog, underscores a broader narrative of risk and opportunity for NVAX.

Understanding the Short Interest Landscape

Short interest in Novavax, as reported by Nasdaq and multiple financial data providers, stands at roughly 47.2 million shares as of mid-July 2025. This equates to just under 35% of the available float, a significant figure that places NVAX among the more heavily shorted stocks in the biotech space. The days-to-cover ratio, which measures how long it would take short sellers to cover their positions based on average daily trading volume, remains approximately nine days. This metric implies that any sudden upward price movement could force short sellers to buy back shares, potentially accelerating a price surge.

To contextualise this, the biotech industry often attracts short interest due to the binary nature of clinical trial outcomes and regulatory approvals. Novavax, having pivoted from a COVID-19 vaccine contender to a broader portfolio with recent FDA approvals for updated vaccines, remains a polarising stock. The high short interest reflects scepticism about its long-term growth, particularly as Q2 2025 (April to June) consensus estimates project a per-share loss of $0.05, according to recent analyst reports. Yet, the same data hints at strategic partnerships and royalty streams from Sanofi as potential upsides that could challenge bearish sentiment.

Historical Context and Current Trends

Comparing the current short interest to historical levels provides further insight. In late 2021, during the height of the COVID-19 vaccine race, Novavax saw short interest peak at over 40% of its float, only to decline as vaccine approvals materialised. Fast forward to 2025, and the renewed high short interest appears tied to doubts over sustained revenue growth beyond seasonal vaccine sales. Unlike the 2021 period, where short positions were often unwound rapidly due to positive news catalysts, the current landscape lacks a clear near-term trigger, as per analysis from platforms like Seeking Alpha. This raises the question of whether the short interest is a contrarian signal or a justified bearish stance.

Recent stock performance adds another layer. As of the latest trading session in July 2025, NVAX closed at $6.97, reflecting a modest 1.9% gain for the day, per Yahoo Finance data. While this price level is far below the highs seen in 2021, it suggests stabilisation, potentially emboldening short sellers to maintain their positions unless a significant catalyst emerges.

Short Squeeze Risk: A Double-Edged Sword

The elevated short interest naturally brings the spectre of a short squeeze into focus. A short squeeze occurs when rising stock prices compel short sellers to cover their positions, driving further price increases. For Novavax, with a days-to-cover ratio of nine, the mechanics are in place for such an event if positive news—such as unexpected revenue beats or new partnerships—materialises. However, the absence of immediate catalysts, coupled with ongoing losses projected for Q2 2025, tempers the likelihood of a sustained squeeze.

Investors should also consider the borrow rates for NVAX shares, which, according to Fintel data, remain elevated due to the high short interest. This increases the cost for short sellers to maintain their positions over time, potentially acting as a subtle pressure point. Yet, without a fundamental shift in the company’s outlook, this alone may not trigger a mass exodus of shorts.

Financial Snapshot and Market Positioning

To ground this analysis in concrete figures, the table below summarises key metrics for Novavax as of July 2025, drawing from publicly available data and recent analyst reports.

These figures highlight the precarious balance Novavax occupies. The short interest is a clear risk factor for volatility, but the projected losses for Q2 2025 (April to June) suggest operational challenges that could validate bearish positions. Meanwhile, strategic moves, including partnerships with Sanofi, offer a counterargument for potential recovery, though the timeline for meaningful impact remains uncertain.

Conclusion: A Stock to Watch, Not to Chase

Novavax presents a fascinating case study in market dynamics, where high short interest could either signal an impending reversal or a justified cautionary tale. The near-35% of shares sold short, coupled with a nine-day cover ratio, sets the stage for potential fireworks if positive developments emerge. However, the underlying financials, with continued losses expected in Q2 2025, advise against unbridled optimism. For now, NVAX remains a stock to monitor closely, particularly for signs of unexpected catalysts or shifts in sentiment, rather than a clear-cut opportunity. The biotech arena rarely offers easy answers, and Novavax is no exception—perhaps a fitting irony for a company that has weathered more than its share of market storms.

References

• ACInvestorBlog. (2021a, February 4). $NVAX over 30% of float short… [Post]. X. https://x.com/ACInvestorBlog/status/1357331281181294592
• ACInvestorBlog. (2021b, April 17). $NVAX Shorts borrowed another 800k shares yesterday… [Post]. X. https://x.com/ACInvestorBlog/status/1383052041745002500
• ACInvestorBlog. (2021c, April 17). This is why shorts are trapped in $NVAX… [Post]. X. https://x.com/ACInvestorBlog/status/1383087675029196800
• ACInvestorBlog. (2021d, July 12). $NVAX days to cover almost at 4… [Post]. X. https://x.com/ACInvestorBlog/status/1414637170640424963
• ACInvestorBlog. (2021e, September 2). $NVAX SI update, shorts added 1.6m shares… [Post]. X. https://x.com/ACInvestorBlog/status/1433660100263260171
• AInvest. (2025, July). Novavax’s Strategic Gambits Signal Growth Amid Earnings Hurdles. Retrieved from https://ainvest.com/news/novavax-strategic-gambits-signal-growth-earnings-hurdles-2507
• DirectorsTalk Interviews. (n.d.). Novavax, Inc. (NVAX) Stock Analysis: Examining the 102% Upside Potential. Retrieved July 3, 2025, from https://www.directorstalkinterviews.com/novavax-inc-nvax-stock-analysis-examining-the-102-upside-potential/4121198687
• Fintel. (2025a, July). NVAX – Novavax, Inc. Stock – Share Price, Short Interest, Short Squeeze, Borrow Rates (NasdaqGS). Retrieved from https://fintel.io/ss/us/nvax
• Fintel. (2025b, July). Novavax, Inc. (NVAX) SEC Filings. Retrieved from https://fintel.io/s/us/nvax
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• MarketBeat. (2025, July). Novavax Short Interest Data & Chart. Retrieved from https://www.marketbeat.com/stocks/NASDAQ/NVAX/short-interest/
• Morningstar. (2025, July). Novavax, Inc.: Stock Analysis & Reports. Retrieved from https://www.morningstar.com/stocks/xnas/nvax/quote
• Nasdaq. (2025, July). Novavax, Inc. Common Stock (NVAX) Short Interest, Settlement Dates, & Share Volume. Retrieved from https://www.nasdaq.com/market-activity/stocks/nvax/short-interest
• Seeking Alpha. (2025, July). Despite Revenue Jump, Novavax Appears Immune To Long-Term Growth (NASDAQ:NVAX). Retrieved from https://seekingalpha.com/article/4800750-despite-revenue-jump-novavax-appears-immune-to-long-term-growth
• Yahoo Finance. (2025a, July 3). Novavax, Inc. (NVAX) Rises Higher Than Market: What You Should Know. Retrieved from https://finance.yahoo.com/news/novavax-nvax-rises-higher-market-214502702.html
• Yahoo Finance. (2025b, July 3). Novavax, Inc. (NVAX) Stock Price, News, Quote & History. Retrieved from https://finance.yahoo.com/quote/NVAX/