There are 2.2 million shares short of Gaiam stock, and the average trading volume is only 161,000. Using a back-of-the-envelope calculation, it would take more than 10 days of nonstop short-covering for the shorts to stop losing money if the stock were to move higher.
Analysts expect Gaiam to earn 31 cents a share in 2007, up from 23 cents in 2006 and 8 cents in 2005. That's nice growth. Revenue is expected to grow from $217.7 million to $247.7 million.
The company and insiders also just bought back $32 million worth of stock from Steve Case's Revolution Living. Who were these insiders? Prentice Capital, a spinoff of Stevie Cohen's SAC Capital, bought back $7 million of the shares. I like following Prentice because it's a trailblazer. Often, SAC piggybacks its shares with Prentice, as it did with another retailer, Wet Seal (WTSLA).