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Shares of heavily-shorted Weber heat up on Thursday (NYSE:WEBR)

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Weber Inc. (NYSE:WEBR) is likely the latest stock to surge on a short squeeze amid recent market volatility.

Shares of the Illinois-based grill manufacturer rose over 15% in Thursday’s trading, reaching a height of $10.60 at its intraday peak. The gain on Thursday adds to significant gains in recent days, amounting to a nearly 40% gain so far in the holiday shortened week.

According to financial data analytics firm S3 partners, the stock’s significant short interest that stands at $86.7M, or about 58.91% of total float, is a key factor to consider. The firm’s data also reveals that stock borrow utilization is at 99.5% leaving almost no stock left to borrow for new short sales.

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“Weber (WEBR) is an extremely Crowded short, scoring a 97.50/100.00 in our Crowded metric and is a very squeezable security, scoring a 100.00/100.00 in our Squeeze score metric,” S3 Partners Managing Director of Predictive Analytics Ihor Dusaniwsky told SeekingAlpha. “With mark-to-market losses mounting, especially over the last two trading days, we should see some short covering due to a price squeeze. With the amount of tradable shares relatively small in this stock, the effect of the buy-to-covers resulting from this short squeeze will have an appreciable effect on its stock price.”

He added that high borrow fees and a dearth of available stock to borrow will allow for only “extremely minimal short selling into this rally.” As such, he expects the price to continue to climb as buyers grow emboldened amidst the rising price action.

“With added buy-side pressure from buy-to-covers and virtually no sell-side relief from short-selling Weber’s (WEBR) stock price trajectory should continue a steady climb as long as long stock buyers remain active,” he concluded.

Read more on recent earnings results that encouraged short-sellers to zero in on the stock.

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