The Wendy’s (WEN) Conspiracy: Why the Smart Money is Trapped

​There’s some noise going around about a deleted post that started this whole thing, but let’s just lay out the actual timeline. Right at the start of June, the USDA confirmed a screwworm outbreak in Texas cattle that’s been migrating up from Central America. It’s a nasty, aggressive parasite that can absolutely wreck the cattle industry. The "smart money" in Wendy’s clearly caught wind of this, figured it would decimate their bottom line, and decided to dump their bags on us. They probably finished flipping their positions to net-short just yesterday.

​The joke is on them, though. Since when does this market actually care about fundamentals or bottom lines? Wendy’s has a tiny $1.5B market cap and actually brings in real cash, while hype trains valued at a trillion dollars make nothing.

​Now that the institutions have unloaded shares and cranked up the short interest, their next move is completely predictable: they’re going to blast this screwworm epidemic all over the breaking news to try and scare everyone into a panic crash.

​Honestly? Let them try. They can suspend the dividend for all I care. I am flat-out not selling at these prices, and there are two big reasons why.

​First of all, the brand is bulletproof. Walk up to any random person on the street and ask if they know Wendy's. They do. It’s a massive international staple that isn't going anywhere.

​Second, the short interest reporting lag is a massive trap, and they're caught in it. Market makers love to abuse their legal naked shorting privileges because it gives them a massive grace period before they have to show their cards. The official Short Interest report for June 15 drops tonight, and I bet it’s going to look lower than the ~35% we saw on May 29.

​Why? Because they started a pump yesterday, right before this data goes public. They want a lower June 15 number to make it look like the squeeze is dead and there's "nothing to see here." But remember—tonight's data is already ten days old. They didn’t want to be short ahead of the pump; they wanted to open their massive shorts during the pump.

​The real damage they are doing right now (between June 15 and June 30) doesn't have to be reported to FINRA until July 2. Between now and then, their only goal is to drive the price into the dirt and force retail to panic sell before the 30th so they can cover their tracks. If shareholders just sit tight and hold, these funds will be forced to aggressively unwind and buy back shares on June 30, or else report an astronomical, blatantly illegal short interest spike.

​So here is the game plan. Expect a deceptively low SI number in the report tonight, expect a sudden wave of mainstream news articles pushing the screwworm panic, and expect some artificial price drops over the weekend.

​The play is simple: buy this dip right now because it's highly profitable once the trap springs. Lock the float, hold indefinitely, and go grab some baconators while we wait for them to unwind.

​#WEN #ShortSqueeze #MarketManipulation #ValueInvesting #Tendies