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Short interests in Evofem jumps from 6% to 50% in June following the Roe v. Wade decision

Yahoo Finance's Alexandra Semenova joins the Live show to detail the surge in short interests for birth control developer Evofem Biosciences, as U.S. companies continue to remain silent on abortion following the Roe v. Wade decision.

Video Transcript


SEANA SMITH: In the aftermath of the Supreme Court's reversal of Roe v. Wade, Wall Street is ramping up bets against a woman's health company. Yahoo Finance's Alexandra Semenova joins us now with more. And Alex, what can you tell us about this? Because it's having a real impact on one particular stock.

ALEXANDRA SEMENOVA: Guys, following the decision, short sellers saw it as an opportunity to pile into a company that is focused on creating contraceptives and reproductive care products for women. That company is called Evofem Biosciences, ticker EVFM, according to data from S&P Global Market Intelligence. Short interest in the company surged past 50% at the end of the month immediately after the ruling. Important to note that short interest was at about 6% before that ruling. It became the second most shorted company at the end of June.

As we know, short selling is an investment strategy that involves traders betting that a company will decline. And a lot of experts were talking about how birth control might be restricted following this decision. So it made sense that traders saw this as an opportunity to pile into a birth control company, thinking that it might see some downturn.

RACHELLE AKUFFO: And Alexandra, some companies haven't said anything. They've not spoken up about what they're going to do. What do we know about these companies who are staying silent or some of the movement that we're seeing from companies as a result?

ALEXANDRA SEMENOVA: Well, following the decision, it seemed like a flurry of companies were coming out and saying that they would cover travel expenses for their employees who might need abortions in states that were looking to ban or restrict them. So on the surface, it seemed like one of those corporate social movements where companies were coming out with statements in support of this issue.

But if you looked at the statements on a granular level, the companies are merely changing their healthcare policies, reiterating their support for employees, but they weren't actually saying much about the actual decision. They weren't saying that they were for or against it. A lot of companies were very reticent about saying anything.

When it comes to social issues, we've seen corporate America become more vocal in the last few years. Certainly, things like LGBTQ rights, racial equality, those are widely embraced, so companies feel a bit more comfortable talking about them. But the ones that are a bit more controversial like gun control, or the ones that seem more controversial on the surface, gun control, immigration, abortion, they're a little bit more mum on those issues.

RACHELLE AKUFFO: We'll certainly be keeping an eye on some of those companies. A big thank you there, Alexandra Semenova. Thank you so much.