in

UWMC DD, Technical Analysis and Bull Case for Short Squeeze

**What’s UWMC (United Wholesale Mortgage Company):**

* UWMC was a former private company brought public through a SPAC under GHIV
* UWMC is the second largest mortgage company in the US (#1 is RKT) and the largest mortgage wholesaler in the US
* Went public in order to generate more capital and aggressively expand and develop their business to takeover the #1 spot

**Technical Analysis**

https://preview.redd.it/144nmouy6yk71.png?width=700&format=png&auto=webp&s=923e7424224dd1b1559538d3fd7156046a58378f

RSI is normal
MACD shows a weak buy signal
Stochastics shows a neutral signal
stock price is in the lower range of the Keltner Channel
death cross (50MA under 200MA) is present (bearish indicator)

Resistance at $7.46, $7.60, $8.25, $8.89 and $10
Support at $7.31

Not gonna lie, the technicals aren’t looking very good for this company. So why am I mentioning this company? Because there’s good reason to believe that a short/gamma squeeze is possible with the current setup based on the call share structure, option chains, and upcoming catalysts.

**Short Squeeze Setup**
There’s currently 88 million shares available as the public float with short interest at 10 million shares. Institutions hold about 28million shares. Meaning the public float is only about 60 million shares, making it a low float and easier to move up the stock price.

https://preview.redd.it/3jhy0rl07yk71.png?width=1435&format=png&auto=webp&s=9a00bec927df8cc2350deffb8263fdc27e227664

Take a good look at the open interests in the number $8 call options. Add up the call options $9 calls on top, and you have over 50k in open interests for September 17th call options.

​

https://preview.redd.it/sbnj4fu17yk71.png?width=947&format=png&auto=webp&s=8bea294937a95532350ef4f60f5e9fd990ec13bd

Now take a look at the average trade volume (approximately 4 million). It’s not hard to figure out MMs and Institutions are shorting the stock and are manipulating the stock price to keep it below $8 to have all those call options expire worthless.

**Upcoming catalysts:**
– Ex-dividend date is September 9th for their $0.40/annual dividend ($0.10 for this quarter).
– Dividend Payout is October 6th.
– UWMC accepting cryptocurrency by the end of September
– $300 Million in share buybacks

Now if you add in the number of shares being shorted (approximately 10 million shares) with them having to return those shares by the ex-dividend date (September 9th), along with the open interests in both the $8 and $9 calls (50k x 100 = 5 million shares). That’s 15 million shares, or one quarter of the public float. If trade volume ever exceeded 10 million, than we would have enough momentum to generate a short/gamma squeeze on this stock.

What do you think?

Leave a Reply

Your email address will not be published. Required fields are marked *

GIPHY App Key not set. Please check settings

33 Comments

  1. The mini squeeze before the last ex-div was preceded by a huge spike in short borrow fees, a higher total short interest, and higher volume on the stock overall.

    We’ve got none of that this time, I just don’t see it. Shorts saw the pathetic buyback numbers in the last ER (spent 6 million, less than a million shares, out of $300M authorized) and aren’t scared anymore

  2. For the millionth and a half time, UWMC is not a short squeeze play 🤦‍♂️. If you want to take advantage of some sweet divitendies at a great price and an undervalued company that will EVENTUALLY go up in share price, then hop right on board.

    There will be no squeeze, only divitendies and future gains.

  3. i played UWMC like this:

    i bought the shares at $6.80 in may. I sold the jan ’23 7 straddle (selling puts and calls at the same strike) for net $4.60, for a basis of $2.20. I’ll get $0.60c in dividends between now and jan ’23. if it’s over $7, i’ll get called away for $5.40 profit on $2.20 outlay or about 250% return in 500dte If it’s between 1.80 and 7 i have to buy back the puts but still come out ahead. If i get called away early i don’t care.

    If you don’t like tying up the capital and want more leverage you can replace the shares with a call, e.g. the 5c which has nearly 0 extrinsic.

    Today, that straddle is $3.60, so not quite as lucrative (edit: not as lucrative to put it on today), but you can work out your own numbers for e.g. a straddle at the $10 strike.

    Good luck to all, not investment advice.

  4. Already in 1 thousand shares here. If nothing else, I hope whatever entities are regularly shorting the daylights out of this stock review this post and at least get a healthy fear of continuing to short it. Being long here and closely following the charts, I’m not looking for a “play” to get the SP pumped, we just need it to stop getting the ol beatdown, and the price on this stock will go up on its own lol… On another note, nice analysis, and great presentation.

  5. Nice DD, really brought a lot.

    Gamma squeeze if fairly lucky, short squeeze is kinda out of the question. Good company and good prospects, not a whole lot of reason to short them imo but hey, market open tomorrow imma buy some, I’m retarded and eat crayons so let’s a go

  6. I’m seeing less than 1% SI. Also, they don’t have to return shares for a dividend date. Where on earth did you come up with that? They just have to pay 10 cents a share. Annoying for them I’m sure, but they aren’t going to blow themselves up buy buying for several dollars above the current price just to avoid 10 cents a share.

    Bagholder with 3k shares at 10, so I’d love to be able to get out of this sucker, and even more love to do so at a profit…but short squeeze does not look like it is on the table

🍼You Can’t Trust Much in This World, But You CAN TrustBaby ! – LOW MC – Passive Income – Ready to Moon! 🚀

Security idea: let users set daily spending limit, then require 2FA for any transaction after the limit is hit