Health and Healthcare
Short Interest Rises in Major Pharma
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The short interest data have been released for the December 15 settlement date. Pharmaceutical companies usually are involved in a lengthy process in getting their drug candidates to market through clinical trials. There is a fair amount of risk involved, should a study come back negative or a candidate not be approved. Conversely, if a drug is approved or passes a clinical trial, there can be big upside.
Drug prices have been under pressure due to the campaign rhetoric. But now that the election is over and Hillary Clinton — one of the main antagonists of these companies — is no longer running, the pressure has seemingly let up, if just slightly for the moment.
The December 15 short interest data have been compared with the previous figures, and short interest increased in most of these selected pharmaceutical stocks.
Keep in mind that short sellers betting against big pharma are taking on an added risk. They have to pay out the ongoing high dividends on top of the cost of borrowing the shares.
Pfizer Inc. (NYSE: PFE) saw its short interest increase to 44.19 million shares from the previous 43.74 million. Its shares closed Tuesday at $32.53, within a 52-week trading range of $28.25 to $37.39.
Merck & Co. Inc. (NYSE: MRK) had a decrease in the number of its shares short to 18.75 million, from 21.27 million in the previous period. Its shares closed Tuesday at $59.79, in a 52-week range of $47.97 to $65.46.
Teva Pharmaceutical Industries Ltd. (NYSE: TEVA) short interest increased to 19.47 million shares. The previous level was 15.12 million. Shares closed Tuesday at $36.34, in a 52-week range of $34.57 to $66.55.
Bristol-Myers Squibb Co. (NYSE: BMY) saw its short interest drop to 13.35 million shares, compared to the previous reading of 15.11 million. Shares closed Tuesday at $59.33, within a 52-week range of $49.03 to $77.12.
AbbVie Inc. (NYSE: ABBV) short interest increased to 38.02 million shares, compared to the previous 29.80 million. The stock closed Tuesday at $62.50, in a 52-week trading range of $50.71 to $68.12.
Eli Lilly and Co.’s (NYSE: LLY) short interest increased to 7.63 million shares from the previous 6.80 million. The stock closed Tuesday at $73.81. The 52-week range is $64.18 to $87.10.
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