What does high short float % mean?

I'm considering buying GPRE and holding a while. It has pulled back a good deal. Broker rating is a 2.0. It has a Zacks 1 rank. But I notice it has a 20% short float on finviz.com. Does this mean that the stock should go up pretty good when the short sellers cover their position?

Can someone help explain the significance of short float %? Also, what's considered a high or unusual short float %?

Thanks.

It's the percentage of shares outstanding that are shorted. It becomes significant when you consider how many shares are shorted vs the avg daily volume....means how many days to cover those short shares at that volume. So if you have say a 30% short float with 15 days to cover...and suddenly something happens to generate larger buying volume it could become a short squeeze. Where shorts are clamoring to cover their positions as they have undefined risk to the upside. Fear sets in and they may be willing to pay higher and higher prices as buyers are buying and shorts are covering.

If I were looking for a potential short squeeze set up I would look for small/med cap stocks with a short float over 30% with more than 10-15 days to cover....that was already beat down a bit. You can get some nasty action on that. Makes for a good earnings play if you limit your downside risk by limiting your upside potential. But keep in mind....if it's heavily shorted, there is probably a reason. But 20% on something on a pullback doesn't sound out of line to me. Just sounds like people riding the trend.

And a larger cap stock where the bigger fish swim the big players probably aren't going to have naked short positions as much as smaller players in smaller stocks. They may be delta hedged to some extent and better capitalized with the ability to hedge the delta risk and less likely to be shook out. This can be true for any size stock but if the option market doesn't have much to offer there will be more naked positions prone to being squeezed.

It's current downtrend doesn't seem news related....just looks like it's following the /ES.

Short Float:

floating-bus.jpg

"The test of a first-rate intelligence is the ability to hold two opposed ideas in mind at the same time and still retain the ability to function" - F. Scott Fitzgerald

Blaine was just fooling with you, this is the correct answer:

Short float:

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Thanks guys, especially Blaine and Thierry. A picture's worth a thousand words. :)