Abby Yoder, JPMorgan Private Bank’s chief equity strategist, joined CNBC’s ‘Closing Bell’ on July 2 to discuss the market’s momentum as stocks began the second half of the year. Yoder confirmed her continued optimism and bullish stance, and referenced JP Morgan’s bull case, which projects the S&P to reach around 7,000 by the middle of the following year. She acknowledged that there was still much to learn in July, particularly concerning corporate earnings and policy developments, including tariffs. However, she emphasized that the 7,000 target appeared relatively plausible due to fundamental strength from a margin and earnings perspective, together of course with the continued market momentum.
Yoder is of the idea that the anticipated tax bill would lead to better growth than currently expected, that earnings would surpass current forecasts, and that the ultimate impact of tariffs on the economy would not be as severe as feared. She explained that when companies reported their results for the previous quarter, they had been operating under a worst-case scenario regarding tariffs. Consequently, their guidance for the subsequent quarter saw estimates revised down by about 4.5% to 5%, which was higher than the typical reduction of 3% to 3.5%. She noted that companies had attempted to provide a framework for these expectations. Yoder then connected this to macroeconomic data and stated that since the data had not shown the effects of tariffs, it was likely that company results also would not, suggesting potential upside surprises.
That being said, we’re here with a list of the 10 best high short interest stocks with huge upside potential.
A portfolio manager in front of their computer screen, evaluating a variety of mid-cap stocks.
Methodology
We sifted through different stock screeners to compile a list of stocks with a short interest between 10% and 25%. We then selected the top 10 stocks with an upside potential of over 25%. The stocks are ranked in ascending order of their upside potential. We have also added the hedge fund sentiment for each stock, as of Q1 2025, which was sourced from Insider Monkey’s database.
Note: All data was collected on July 3.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best High Short Interest Stocks With Huge Upside Potential
10. Peloton Interactive Inc. (NASDAQ:PTON)
Short % of Float as of June 13: 19.74%
Number of Hedge Fund Holders: 52
Average Upside Potential as of July 3: 24.25%
Peloton Interactive Inc. (NASDAQ:PTON) is one of the best high short interest stocks with huge upside potential. Earlier in June, Peloton officially launched “Peloton Repowered,” which is a new peer-to-peer resale marketplace for its equipment and accessories. Currently in its beta phase, the platform is initially available only to sellers located in the Boston, New York City, and Washington, D.C. metropolitan areas, with plans for national expansion in the coming months.
At launch, users can list items for sale, and the ability to purchase is expected to become available to buyers in the same metro areas within the then-next few weeks. Sellers on Peloton Repowered will receive 70% of the sale price. Additionally, successful sellers will be given a discount on new Peloton workout equipment, ranging from $200 to $600, depending on the type of new equipment purchased.
Buyers utilizing Peloton Repowered will benefit from a reduced used equipment activation fee of $45, which is a decrease from the typical $95 fee. Sellers have the option to arrange for pickup with buyers or use a prepaid USPS label for accessories. The Peloton Repowered platform is operated in partnership with Archive, which is a resale company that raised $15 million in a Series A funding round in 2022 and recently completed a $30 million Series B funding round on February 4 this year, bringing its total funding to $54 million.
Peloton Interactive Inc. (NASDAQ:PTON) operates an integrated fitness platform in North America and internationally.
9. Patterson-UTI Energy Inc. (NASDAQ:PTEN)
Short % of Float as of June 13: 13.86%
Number of Hedge Fund Holders: 45
Average Upside Potential as of July 3: 26.78%
Patterson-UTI Energy Inc. (NASDAQ:PTEN) is one of the best high short interest stocks with huge upside potential. Earlier in June, Patterson-UTI Energy reported its drilling activity for May this year. For the whole month, he company had an average of 103 drilling rigs operating in the US.
Looking at a broader period, the average number of drilling rigs operating in the US for the 2 months ended May 31 this year was 106. Average drilling rigs operating reported in Patterson-UTI Energy’s monthly announcements represent the average number of the Company’s drilling rigs that were earning revenue under a drilling contract in the US.
The company clarifies that the “average drilling rigs operating” reported in their monthly announcements represent rigs that were actively earning revenue under a drilling contract in the US. Patterson-UTI cautions that this metric alone does not fully impact the company’s operating results, as numerous other factors can influence financial performance as well.
Patterson-UTI Energy Inc. (NASDAQ:PTEN) intends to continue providing monthly updates on drilling rig activity shortly after the end of each month. The company provides contract drilling services, integrated well completion services, and directional drilling services in the US, as well as specialized drill bit solutions in the US, the Middle East, and other international regions.