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American Airlines spikes 33% as Reddit traders direct their attention towards another heavily shorted stock – Business Insider

American Airlines Boeing 737 Max

American Airlines soared as much as 31% on Thursday as traders that frequent Reddit’s WallStreetBets forum sparked short squeezes in a growing list of stocks this week.

“AAL the next GME?” one Reddit user asked in a post on Wednesday.

After successfully squeezing hedge fund managers out of GameStop, Reddit investors have set their target on other highly shorted companies.

American Airlines seems to have fit the bill, with about 30% of the float sold short. On top of that, the company had a catalyst the set the move on fire: earnings.

On Thursday, the airline operator reported better than expected fourth-quarter earnings results, beating both revenue and income estimates.

Shares hit a high of $30 in Thursday’s pre-market trading session, representing a gain of as much as 81%. And the gains in short-squeezed stocks don’t appear to be letting up yet, as evidenced by GameStop, which soared more than 40% in Thursday morning trading to a high of nearly $500.

Read more: MORGAN STANLEY: Buy these 17 stocks with strong earnings that are expected to outperform into 2022 even if the broader market sinks

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