Cardlytics Earnings Spark Short Squeeze
Cardlytics ($CDLX) reported earnings amid what traders are calling a textbook short squeeze, with investors actively adding shares. The move comes as rumors surface that Iran's intelligence ministry is reaching out to the US for potential negotiations, sparking recovery talks across beaten-down stocks.
Prior to the recent surge, Cardlytics carried significant short interest, with 13.46% of its publicly available shares sold short as of mid-February. The days-to-cover ratio stood at over 10, indicating it would take more than two full trading weeks for short sellers to buy back all their borrowed shares. The company's latest financial results featured a record-setting adjusted EBITDA of $10 million in the fourth quarter, contributing to its first full year of positive adjusted EBITDA since 2019. For the full year 2023, Cardlytics reported revenue of $309.2 million, a 4% increase from the previous year. A key factor in the company's outlook is its recent partnership with American Express, a major development seen as a catalyst for future growth. This follows a period of operational challenges, including advertiser budget delivery issues and the resignation of its CEO in 2024. Despite the positive earnings report, the stock has been significantly beaten down, having fallen 57% in the twelve months leading into 2026. Analyst ratings before the earnings release were largely cautious, with a consensus "Hold" rating and an average price target of around $1.50 to $1.63.
