Imergent's Wild Ride

Even so, there is continuing institutional interest in the shares. Bear Stearns(BSC Quote) bought 441,731 shares worth about $7.76 million in the last reporting period of 2006, and total institutional positions increased by 1.2 million shares.

Yet there's no sign the shorts are ready to let go. Indeed, the put/call ratio of 1.18 is higher than it has been for most of the company's history, according to Joe Sunderman of Schaeffer's Investment Research.

Imergent CEO Danks says he plans to step up the pace of buybacks, while the board just declared a quarterly dividend of 10 cents a share. An acquisition also is possible. And perhaps most important of all, Danks & Co. are waging an aggressive and proactive campaign to convince state regulators that Imergent is clean.

Top of the SHO

You'd have to look hard to find a company hit harder by short-selling than Imergent. At one point, it would have taken an astonishing 60 days to cover those positions. That has fallen as volume strengthened, but overall short interest rose 28% in February to 65% of the float. Imergent has been on the threshold securities list of the American Stock Exchange for 112 consecutive trading days.

Keeping track of Imergent's shares takes more than a calculator. The company has about 12.3 million shares outstanding and a float of 10.6 million shares. Institutions own 9.1 million shares. Even if retail holdings were zero, the total number of long positions plus short positions is over 16 million, more than half again the float.