US stocks with recent surges but low short interest, are showing significant squeeze risk, alongside European counterparts driven by high short interest.

In the U.S., stocks deemed to have "squeeze risk" are those that have experienced significant recent gains but do not have a high percent of their float shorted.

Starbucks (SBUX) recently surged 25%, a record increase for the company, following the announcement of a new CEO. Despite this impressive gain, Starbucks has a low percentage of shares floated shorted, 2% of the float.

However, the squeeze risk metric incorporates two key components: the structural crowded score and the measure of short-term returns. While Starbucks' low short interest may reduce the traditional squeeze risk, the extraordinary magnitude of its recent return makes it noteworthy in the context of squeeze risk assessments. The combination of high short-term performance and the low level of short interest warrants careful consideration.

SBUX US

The current squeeze score stands at 75, surpassing the critical threshold of 70. This suggests that short sellers may face pressure to cover their positions, especially if the stock's price continues to rise.

Among other stocks in the S&P 500, none have surpassed a score of 70. However, two stocks, FICO and Axon (AXON), have scores above 60. FICO, which recently gained 10% following a 20% increase, has a short interest of 3.37% of the float and a squeeze score of 65.

Axon's current squeeze score is 60, but it remains notable within this context.

FICO US

AXON US

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Axon (AXON) presents a similar scenario, with 3.6% of its float shorted. Following an 18% gain in a single day due to earnings, Axon's squeeze score is 62.5.

In Europe, stocks identified as having squeeze risk are primarily driven by crowded score rather than recent returns.

Stocks with a squeeze risk score of 70 or above all exhibit short interest exceeding 13%, with some significantly higher. The primary factor driving these scores is the crowded short position, with crowded scores typically only 10 points below the squeeze risk numbers.

So although the squeeze score is high we qualify that and say slightly squeezable as the recent move is small and most comes from the structural factors.

Month-to-date (MTD) returns for these European stocks are relatively modest, generally 2% or less.

These European situations involve more persistent factors related to large short positions.

For instance, Verbund has recently rallied, which has led to its squeeze score exceeding its crowded score. This indicates that the stock's price movement is starting to significantly impact the short positions.

Boss has a squeeze score that aligns with its crowded score, reflecting a balance between short interest and recent performance.

Elekta and Avanza Bank, both based in Sweden, have also experienced rallies. This upward movement has pushed their squeeze scores above their respective crowded scores, highlighting increasing squeeze risk in these cases.

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