WIN is already heavily shorted. With this latest debacle, the stock is going to be relentlessly attacked by short sellers and there's virtually nothing the company can do at this point to fend it off. Immediate consequence will be additional losses from the already 57 percent loss in after hours trading Friday. Mid term consequence will be delisting from Nasdaq and tremendous pressure on not only the company's debt, but also its equity. I don't know if Windstream is going to make it through this without reorganizing or liquidating.
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Short interest for WIN stands at around 30%, which means 30% of the current float has been sold short (by those expecting and wanting the price to fall). While short sellers do have to find shares to borrow, typical the brokers being used already have this stock on hand, or other investors with the broker may hold shares and have them involved in a program by which they themselves can lend shares. The risk to the broker is minimal, the short seller is responsible for delivering the shares back. Brokers also can call these borrowed shares back at their discretion. Short sellers are not your typical retail investors, so you're usually dealing with pros.
To short a stock there must first be someone willing to buy the stock at margin....
For those who don't know about shorting stocks:
To short sell you must have a broker willing to buy that set of stock for some kind of margin to hold ( you give them a deposit like 10% and they buy and give you the stock) for which you then quickly sale for around what you the broker paid or maybe even a small loss.... Then you buy the stock at a lower price when it dumps before margin call and repay them in stock at the lower price. So your profit is what you sold the original bought on margin price - price purchased it at later.
Like most deals or money making opportunities in capitalism someone gets the shaft. In this case it's the broker, so if the brokers say nope not buying that for you at margin then you cant short sell it.. The idea with buying on/with margin is you have some kind of insight they don't or cant have... You are buying way more stock then what you could afford other wise and if it goes up you can sell it for a profit for which they keep even more of a percent. However short selling is just cheating that system becuase you don't owe then the price at stock purchased you just owe them x amount of shares at call. Typically brokers are wiser to this technique and will typically raise the percent of margin up to what they forecast the stock dropping at (thus cutting into your potential reward), or in some cases they just know it's a bad bet and tell you to take a hike.
Even worse for a short seller is if the stock market freezes traedeing on that stock while you have already sold the stock or after you purchased the stock at the lower number, especially if it enters bankruptcy as typically stock can't be transferred ownership. Now you are on the hock for your broker at orignal purchase price as you can't give them the stock and you have stock that is basically worthless to you because you can't move it.