Tootsie Roll at record highs as shorted stocks get trader love

The maker of Tootsie Pops has spiked to a record as retail traders pour into heavily-shorted stocks fueled by excitement over GameStop Corp.’s meteoric surge.

Shares of Tootsie Roll Industries Inc. soared 53 per cent into record territory Wednesday, adding to its gains this week, and triggering a brief trading pause. A spokesperson for the company didn’t immediately comment.

The company, maker of its namesake candy along with other consumer brands like Junior Mints, has had a challenging year as traditional candy-consumption events like Halloween and birthday parties were disrupted by the COVID-19 pandemic. Sales fell 14 per cent in the latest quarter, as both planned and impulse purchases of the products declined.

But while falling retail sales traditionally lead to lower share prices, Reddit-charged day traders have been piling into previously unloved tickers in recent sessions, driving them to record highs. Short interest in the candy maker is 46 per cent of its float, with 22 days to cover, according to data from S3 Partners.