Tesla Motors (NASDAQ:TSLA) is a stock that has been on quite a run recently after announcing near term profitability, cash flow breakeven, and improved production numbers and margins on its vehicles. Additionally, the company just announced earnings will be on May 8, 2013, which is certain to be a volatile event in one way or the other due to the strong convictions both shorts and longs hold in this company.
Tesla has recently been one of the most shorted stocks on the Nasdaq and that is well documented. There has been a lot of recent debate on whether shorts are hedged or covering over the last few weeks as the stock has increased in value. I penned an article on the hedging shorts have potentially done through call options earlier this week and determined that the shorts were not well hedged through options at this time. With all the questions, I think it is important to note that the updated short interest released yesterday on TSLA is 30,695,142. The previous short interest on 3/28/13 was 31,300,039 shares. Therefore there has been a decrease of only 604,897 shares or about 2% in the last few weeks despite the run up. This short percentage as a percentage of the float is still near 42%. In other words, shorts have NOT been covering on a net basis and remain vulnerable to squeeze. Another interesting item to note is that the next short interest update will not be until May 9, 2013 which is the day after earnings. That is interesting because that means we won't have any better information than this about how many shorts exist prior to earnings.
Conclusion - The recent move in TSLA shares does not appear to be due to net short covering at all, rather new long buyers discovering the name.
Disclosure: I am long TSLA.