The Ratings Game: Fossil shares skyrocket, is short covering to blame?

Fossil’s wearable business has picked up but it still missed initial guidance for the year

Fossil Group Inc. shares skyrocketed 64% on Wednesday after earnings beat expectations, but analysts were not entirely convinced by the move.

Some market participants said the rise may be driven by short-covering. Short interest, or bets that the stock will fall, have more than doubled in the past year to a record high of 18.9 million shares at the end of January, which represents about 39% of the shares outstanding, according to FactSet. In comparison, short interest in Fossil rival Movado Group Inc. MOV, +5.52% represents just 3.8% of the shares outstanding.

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