Do you like to go against the grain? Buying shares of heavily shorted stocks could be right up your alley. These are stocks that some investors are so pessimistic about that they borrow shares to sell. Their bet is that the stock will fall so they can buy at a lower price to give the shares back to the lender.

With all of the hype about the race to develop coronavirus vaccines, it's not surprising that short-sellers have piled on some of the stocks of biotechs with COVID-19 vaccine candidates. But if these companies have good news, there could be a short-squeeze scenario where the stocks skyrocket as short-sellers scramble to cover their positions. Here are the three most heavily shorted coronavirus vaccine stocks right now.

Short-selling sign.

Image source: Getty Images.

1. Inovio Pharmaceuticals

Over 28% of Inovio Pharmaceuticals' (NASDAQ:INO) outstanding shares were sold short as of Aug. 14, 2020, the most recent date for which Morningstar provides short-percentage data. This level makes Inovio the most heavily shorted biotech stock with a coronavirus vaccine candidate in development.

Why have short-sellers targeted Inovio? Part of the attraction is that Inovio's shares rose so much earlier this year that some investors felt the bubble was bound to pop. By late June, the stock was up 860%. It has since given up much of that gain.

Some have also been skeptical about the prospects for Inovio's COVID-19 vaccine candidate, INO-4800. The company reported positive interim results from a phase 1 study of INO-4800 on June 30. However, those results didn't include details about neutralizing antibody levels that many investors wanted.

Inovio could prove the naysayers wrong if it advances INO-4800 into phase 2/3 testing. Its stock would almost certainly soar should the biotech win federal funding for its COVID-19 vaccine program. In addition, Inovio could have good news on the way in the fourth quarter of 2020 from a late-stage study evaluating VGX-3100 in treating human papillomavirus-related precancerous cervical dysplasia.

2. Sorrento Therapeutics

Sorrento Therapeutics (NASDAQ:SRNE) isn't too far behind Inovio with more than 22% of its outstanding shares sold short. Unlike Inovio, though, Sorrento doesn't have a COVID-19 vaccine candidate in clinical studies yet. Its T-VIVA-19 vaccine is still in preclinical testing.

Short-sellers began to focus on Sorrento in mid-May. Not coincidentally, that's when the biotech stock soared on positive preclinical results for experimental antibody therapy STI-1499 (also known as COVI-GUARD). The sudden departure of Sorrento's CFO in August gave short-sellers the bad news they wanted.

Most of Sorrento's coronavirus programs are, like its T-VIVA-19 vaccine, still in preclinical testing. The lone exception is abivertinib, a drug for which Sorrento acquired rights from ACEA Therapeutics in May. Sorrento is currently evaluating abivertinib in a phase 2 clinical study for treating hospitalized COVID-19 patients.

Success for abivertinib could spark a short squeeze for Sorrento. Other potential positive catalysts for the stock could also be on the way, including a possible Food and Drug Administration (FDA) green light to begin a phase 1 study for STI-1499.

3. Dynavax Technologies

Around 15.5% of Dynavax Technologies' (NASDAQ:DVAX) outstanding shares are sold short. The percentage of the biotech's float (the number of shares available for trading) sold short is even higher -- nearly 21% as of Aug. 14.

Dynavax isn't developing a COVID-19 vaccine candidate of its own. However, its CPG 1018 adjuvant is being used by several companies with coronavirus vaccine candidates, including Clover Biopharmaceuticals, Medigen, and Medicago.

The more Dynavax teamed up with COVID-19 vaccine makers, the more short-sellers piled onto its stock. That's probably because Dynavax's coronavirus vaccine partnerships also fueled a major increase in its share price.

Dynavax doesn't necessarily need any of the COVID-19 vaccine candidates using its adjuvant to be successful to send short-sellers heading for the hills. A surge in sales for its Heplisav-B hepatitis B vaccine could also do the trick.