These factors are magnified by a hyperactive market for APRN stock. That puts upward pressure on prices, forcing more short-sellers to cover, and so on. Shares of Blue Apron could theoretically rise 10X or more if large purchases trigger an avalanche of short covering since rising prices force short sellers to buy back shares to rebalance losing positions. Short-sellers are thus playing with fire. Majority stakeholders RJB Partners, DPH Holdings and the Salzberg family collectively own most of the rest. And though the firm technically has 34.8 million shares outstanding, in practice only around 8 million of those shares are available for trading. Blue Apron now has 5.5 million shares sold short, according to SEC data. stocks by that metric, according to data from Thomson Reuters.īut near-zero prices, high short interest and low float also set the stage for a short squeeze. The firm has lost two-thirds of its value this year and shares now trade for 0.16X forward price-to-sales. The number of Blue Apron customers has dropped 7% to 349,000 this year, compounding an 8% reduction in orders per customer.ĪPRN stock has collapsed as a result. Interest in meal delivery kits has also declined, with searches down 68% since 2018, according to tracking site ExplodingTopics. Only fundraising and share issuances have kept the firm alive. That rate could deplete its cash on hand in less than three months. Low profitability and high marketing expenses mean the company could burn up to $40 million in cash every quarter through 2023. Today, Blue Apron has fallen into the same category. When share prices border on zero, the slightest move can send shares soaring on a relative percentage basis. And bankrupt Sears (OTCMKTS: SHLDQ) has seen its stock double at least eight times in the past five years before sinking back down again. In June, shares of bankrupt cosmetics firm Revlon (NYSE: REV) jumped from $1.08 to over $8 as investors speculated about the 90-year-old firm’s residual value. Retail investors have squeezed bankrupt and near-bankrupt firms before.
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