Weight Watchers International Inc.’s (WTW) stock price spiked over 12% on the heels of Oprah Winfrey’s Golden Globes speech after receiving the 2018 Cecil B. de Mille award. Her stirring acceptance speech and rumors of a 2020 presidential run tweeted by CNN had a run-on effect on WTW’s stock price.
Weight Watchers spokesperson Oprah Winfrey is a 10% owner of the company and the $5.71 price move gave her a $36.4 million mark-to-market profit on her 6,370,283 shares. On the other side of the ledger, short sellers were down $41.2 million of mark-to-market losses on their 7,222,511 share short position.
WTW short interest peaked in mid-August 2017 at $443 million and after hitting a yearly low of $208 million in September short sellers began to gradually accumulate short exposure. Short interest has remained relatively stable over the last several months, trading at a range between $300 million and $400 million.
Short sellers were down $338 million in year-to-date mark-to-market losses in 2017 and thanks to DJ Khaled and Oprah Winfrey, 2018 is continuing the losing trend with $60 million of year-to-date mark-to market losses. If the sales improve due to Weight Watchers new Freestyle Plan, short sellers may be down for a three knockdown TKO.
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Managing Director Predictive Analytics, S3 Partners, LLC
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