Here's Why Lemonade Stock Was Up 21% in June
Shares of insurance-tech company Lemonade (NYSE: LMND) were up 20.9% in June, according to data provided by S&P Global Market Intelligence. It's important to note that the stock is still down about 12% year to date as of this writing and down more than 40% from its 52-week high. However, out-of-favor growth stocks like this were generally regaining bullish investors during June. Furthermore, Lemonade might have had another counterintuitive catalyst helping it march higher.
In May, a firm called Muddy Waters published an open letter to Lemonade's management, explaining how the insurance-tech platform had major security vulnerabilities. In times past, a report like this might have struck fear in investors' hearts and caused the stock to fall as a result. But in 2021, reports from short-sellers have frequently served to galvanize the resolve of bulls. Accordingly, we have seen short interest steadily declining in Lemonade stock. Yahoo! Finance says there were almost 10.5 million shares sold short as of May 14. By June 15, this had dropped to about 7.5 million.
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Source Fool.com
