June 1, 2019, 10:00 a.m. EDT

These are the most expensive stocks for short sellers to borrow

Shares of Beyond Meat carry borrow costs of nearly 70%, while Lyft fees have come down but remain steep

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By Emily Bary


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Several newly public companies crack the list of most expensive short bets, with high-flying Beyond Meat Inc. leading the way.

Shares of Beyond Meat /zigman2/quotes/211617595/composite BYND -0.95% , the maker of plant-based meat alternatives, have nearly tripled since the company’s initial public offering in early May, but short sellers are now having a hard time betting against it due to hefty stock-borrow costs. At 68%, Beyond Meat’s borrow fee is the highest among all U.S. companies with more than $100 million in short interest, according to S3 Partners, a financial technology and analytics company.

See more: Shorting Beyond Meat stock is beyond expensive

Joining Beyond Meat near the top of the list is Lyft Inc. /zigman2/quotes/208999293/composite LYFT +2.86% , which made its public debut in late March. Unlike Beyond Meat, Lyft’s stock has sputtered since the IPO, but the ride-hailing company remains a popular target for bearish bets.

New short sellers have to pay close to 30% to borrow shares of Lyft, making the stock the fifth most expensive short play on S3’s list. Lyft’s fee was in the neighborhood of Beyond Meat’s earlier this month, but it’s come down over the last week, as the number of shares shorted has declined by almost 900,000, said S3’s Ihor Dusaniwsky. He hypothesized that the steep cost of borrowing Lyft shares could prompt some short sellers with downbeat views of the ride-hailing market to bet against Uber Technologies Inc. /zigman2/quotes/211348248/composite UBER +1.66%  instead.

Elsewhere in tech, Zoom Video Communications Inc. /zigman2/quotes/211319643/composite ZM -0.56% , another newly public tech company, places 15th on S3’s list with a borrow rate of just over 6%. Controversial e-commerce and cryptocurrency play Overstock.com Inc. /zigman2/quotes/200022359/composite OSTK -1.40%  cracks the list as well with a 15% borrow fee.

Don’t miss: Overstock shares plunge more than 15% after CEO sells stock

Costly shorts extend beyond the tech sector, as a number of health-industry plays have proven to be expensive bearish bets. Health Insurance Innovations Inc.  and biotechnology company Moderna Inc. /zigman2/quotes/205619834/composite MRNA +2.91%  join Beyond Meat atop the list, with 56% and 46% borrow fees, respectively. Shares of New Age Beverages Corp. /zigman2/quotes/200595917/composite NBEV +1.31% , which is experimenting with CBD products, carry 39% borrow rates for new short sellers.

/zigman2/quotes/211617595/composite
US : U.S.: Nasdaq
$ 136.80
-1.31 -0.95%
Volume: 3.32M
May 22, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$8.51 billion
Rev. per Employee
N/A
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/zigman2/quotes/208999293/composite
US : U.S.: Nasdaq
$ 31.26
+0.87 +2.86%
Volume: 6.70M
May 22, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$9.59 billion
Rev. per Employee
$450,139
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/zigman2/quotes/211348248/composite
US : U.S.: NYSE
$ 34.83
+0.57 +1.66%
Volume: 18.68M
May 22, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$60.39 billion
Rev. per Employee
N/A
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/zigman2/quotes/211319643/composite
US : U.S.: Nasdaq
$ 171.06
-0.97 -0.56%
Volume: 4.30M
May 22, 2020 4:00p
P/E Ratio
2,107
Dividend Yield
N/A
Market Cap
$47.73 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/200022359/composite
US : U.S.: Nasdaq
$ 17.60
-0.25 -1.40%
Volume: 2.19M
May 22, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$709.74 million
Rev. per Employee
$884,268
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/zigman2/quotes/205619834/composite
US : U.S.: Nasdaq
$ 69.00
+1.95 +2.91%
Volume: 28.91M
May 22, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$25.61 billion
Rev. per Employee
$177,721
loading...
/zigman2/quotes/200595917/composite
US : U.S.: Nasdaq
$ 1.55
+0.02 +1.31%
Volume: 2.67M
May 22, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$143.52 million
Rev. per Employee
$304,998
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Emily Bary is a MarketWatch reporter based in New York.

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