What happened
Shares of wholesale mortgage lender UWM Holdings (NYSE: UWMC) had risen nearly 10.3% as of 11:05 a.m. EDT, after the company received some chatter on the popular Reddit forum WallStreetBets.
So what
On WallStreetBets' daily discussion for June 9, one commenter wrote, "Uwmc shorts getting crushed going to be squeezed real soon."
As of May 14, more than 20% of the float had short interest, so it is possible that a short squeeze could occur, in which the rising stock price of UWM forces short-sellers to close out their positions and buy the shares they are shorting, sending the stock price higher.
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I haven't seen any other news that might be driving the company's stock other than the fact that UWM announced yesterday it plans to try to put pressure on competitors by price matching loans until June 20.
Now what
Based on the conversation I'm seeing on WallStreetBets and Twitter, I am more likely to believe that UWM's rising stock price today is due to the potential for a short squeeze and the meme-driven stock craze than anything fundamentally changing the company's position.
This means that like other meme-stock plays, UWM could be quite volatile in the near term. Invest with extreme caution.
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