Heavily shorted BYND and DNUT have climbed out of penny stock territory this week
Penny stocks Beyond Meat Inc (NASDAQ:BYND) and Krispy Kreme Inc (NASDAQ:DNUT) are meming their way back into Wall Street's good graces this week. For three days now, retail traders have been targeting both names with renewed interest, and options traders are starting to get in on the fun.
BYND was last seen up 48.9% to trade at $5.39, a far cry from trading at 50 cents on Oct. 16. On Monday, the fake meat processor announced an expanded Walmart (WMT) distribution to over 2,000 stores, which sent the shares up 127%. The stock followed that up with a 146% melt-up yesterday, as Roundhill Investments added the name to its Meme Stock ETF (MEME).
Before the vault up the charts last Friday, 62% of BYND's total available float was sold short. Now, only 10% of this float remains sold short. The shares traded as high as $205 back in July 2019, but haven't closed in double-digit territory since early 2024.
At last check, 665,000 calls have changed hands, volume that's 10 times the average intraday amount. The December 40 call is seeing sell-to-open activity, while the weekly 10/24 5.50-strike call is also popular.
DNUT is up 21% to trade at $4.56. What makes Krispy Kreme's breakout even more incredible is that unlike Beyond Meat's Walmart deal, there doesn't appear to be any actual news or catalyst behind it. The stock is eyeing its highest close since early April, and with 33% of its total available float sold short, could keep burning bearish bettors.
The call skew is much steeper with Krispy Kreme. In just the first hour and a half of trading, 115,000 calls have been exchanged, volume that's 72 times the average intraday amount and nearly 8 times the number of puts traded. The weekly 10/31 5-strike is leading the charge, while the December 5 call is not far behind.