Workhorse (NASDAQ:WKHS) may be still fighting back after failing to win the U.S. Postal Service (USPS) vehicle contract. But, this last ditch effort isn’t why retail investors are excited once again for WKHS stock. Instead, it’s because of its potential to get short-squeezed “to the moon.”

Shares in the early-stage electric truck company aren’t the only ones being targeted by the “Reddit set.”

As I’ve covered in recent weeks, the r/WallStreetBets community has tried to pull off the same gambit in many “meme stocks.”

Top ones include Clean Energy Fuels (NASDAQ:CLNE), Clover Health (NASDAQ:CLOV), and ContextLogic (NASDAQ:WISH).

Yet, this latest wave peaked a few weeks ago. Most of them are now trading sideways, or trending lower. This points to diminished chances of Main Street traders putting the crowded short-side in a bind.

Just as with the three names mentioned above, a short-squeeze (in theory) could happen here. Like CLNE, CLOV, and WISH, this stock has very high short-interest.

But, with this latest wave of “meme stock” madness running out of energy, even with Workhorse’s potential to win its award protest, it’s best to skip out on entering a position right now.

WKHS Stock and the USPS Award Protest

Losing the USPS award to Oshkosh (NYSE:OSK) was a crushing blow to Workhorse. Anticipation of it winning the award was what sent the stock soaring more than twenty-fold from March 2020 to just before the devastating news.

Losing the award may have resulted in a sell-off from $43 per share, back down to single-digits. But, as we’re seeing play out, it’s not going down without a fight.

With the award protest, investors in WKHS stock are counting on the company to successfully present its case to the U.S. Court of Federal Claims.

Given there’s evidence that the USPS was very favorable to Oshkosh, while quick to take its candidate out of the running, it may have a strong case. Even so, only time will tell whether it sees a favorable outcome, but that’s not the only way its fortunes could dramatically improve.

Washington’s recent push to speed up its “green pivot” could help it out as well. President Biden’s Executive Order for an all EV federal vehicle fleet, and the push by some Democrats in Congress to provide USPS with $6 billion to buy an explicitly all-EV fleet, may point to it down the road getting a big-ticket vehicle order.

As with its award protest, only time will tell whether current political winds will change its prospects as well. In the meantime, the would-be “short squeeze” in WKHS stock could continue to sputter out.

The Attempted Squeeze Losing Momentum

With nearly 34% of its outstanding float sold short, Workhorse remains one of the most heavily-shorted stocks out there.

This level of short interest exceeds levels currently seen in the most successful squeeze plays this year, like AMC Entertainment (NYSE:AMC), where 17% of its float is sold short, and GameStop (NYSE:GME), where around 24.5% of its float is sold short.

Some still have high hopes that its crowded short side, coupled with the company winning its protest, will send WKHS stock “to the moon” once again. But since any decision from the Federal Government is likely months in the making, it’s questionable whether the retail longs can hold on long enough to wait for this to play out.

Especially since, as seen from its moves in recent days, speculators aren’t continuing to pile into it.

Chatter about it on r/WallStreetBets may still be high, but, who’s to say this conversation isn’t just among those that already own it? That is, the endless chatter doesn’t appear to be enticing new buyers that are a little late to the party.

Add in the fact that this latest “meme stock wave” has peaked much faster than the one experienced last winter, and signs point to those owning it today moving to cash out while prices remain elevated.

Bottom Line: Hold Off for Now

Workhorse may have a fair shot winning the protest, but it’s not happening in a matter of weeks. Whether it prevails, or loses again, it’s going to be a while until the final decision drops.

Sure, it may have another path to a comeback, via Congress or the White House pushing for a new EV-only fleet order. But, any action on this will take time as well.

In the meantime, those long WKHS stock could get impatient. If they cash out, shares will continue to drift lower from today’s prices (around $14 per share). Even if you are more bullish on its chances of winning its fight over the USPS bid, the best move may be to hold off for now.

On the date of publication, Thomas Niel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Thomas Niel, a contributor for InvestorPlace.com, has been writing single-stock analysis for web-based publications since 2016.