14 Worst 52-Week High Stocks to Buy According to Short Sellers

6. Rhythm Pharmaceuticals, Inc. (NASDAQ:RYTM)

52 Week Range: $20.97 – $54.88

Current Share Price: $53.64

Short % of Shares Outstanding: 15.77%

Number of Hedge Funds holding stakes as of Q2 2024: 27

Rhythm Pharmaceuticals, Inc. (NASDAQ:RYTM) is a commercial-stage biopharmaceutical company focusing on rare neuroendocrine diseases. Its lead product candidate is IMCIVREE for the treatment of pro-opiomelanocortin.

The developer of therapies for rare genetic disorders has seen its sentiments in the market receive a significant boost in response to strategic initiatives and growth potential. Investors have been upbeat about the company’s prospects, especially on sales of the lead product, increasing 79% to $77 million in the year’s first half.

Moreover, Rhythm Pharmaceuticals, Inc. (NASDAQ:RYTM) has broadened its research and development efforts by starting Phase 2 studies for two fresh MC4R agonists. The firm’s second-quarter results were robust. Nevertheless, the company posting a quarterly loss of $0.55 a share versus expected earnings of $0.70 a share underscores why it remains one of the worst 52-week high stocks to buy, according to short sellers.

The premium valuation is one of the reasons short sellers remain skeptical about the stock edging higher from current levels. Consequently, the stock’s short interest remains at a high of 15.77%. According to Insider Monkey’s database, 27 hedge funds held stakes in Rhythm Pharmaceuticals, Inc. (NASDAQ:RYTM) in Q2 2024, compared to 30 funds in the prior quarter.