The bull market is now eight years old, and markets still keep on hitting new highs. How have the short sellers been reacting to this pricey market? Moves in the most shorted stocks traded on the New York Stock Exchange between the February 15 and February 28 settlement dates were mostly positive and mostly mild.
The outliers were Chesapeake Energy, which saw another sizable gain in short interest, while short sellers reversed course on Pfizer after piling on earlier last month.
Note that the top six stocks on the list all had more than 110 million shares short at the end of the most recent settlement period.
After about a 7% gain in Chesapeake Energy Corp.’s (NYSE: CHK) short interest in early February, it saw another almost 13% rise in the final two weeks of the month. The more than 134.59 million shares short reported most recently were near 14% of the float. Note that short interest was about 204 million shares a year ago. As of the most recent settlement date, the days to cover reading was about three.
Chesapeake posted mixed fourth-quarter results during the period. Between the latest settlement dates, short sellers watched the share price pull back almost 14%. It retreated more afterward and closed most recently at $5.13. That was still up handily from the multiyear low of $3.53 from almost a year ago, but less than the 52-week high of $8.20 seen in mid-December.
Following a surge of about 14% in late January, Weatherford International PLC (NYSE: WFT) was the most shorted NYSE stock. But the number of shares short retreated a bit in early February and was essentially flat in the latest period at more than 118.18 million. That figure represented more than 12% of this oil and gas driller’s total float. At the most current daily average, it would take about three days to cover all the short positions.
Weatherford recently named its new chief executive officer. Its shares ended the two-week period about 8% lower, most of that decline coming early in the period. The stock closed most recently at $6.35, which is about 27% higher year to date. Shares have changed hands between $3.73 and $8.49 in the past 52 weeks.
The short interest has declined in seven of the previous eight periods. The number of Sprint Corp. (NYSE: S) shares short retreated by about 2.8 million shares, or more than 2%, between the most recent settlement dates. The more than 116.46 million shares reported totaled less than 19% of the float. The days to cover rose to about eight during those two weeks.
Like its peers, Sprint now has an unlimited data plan. Sprint’s share price ended the two weeks more than 3% lower than where it began, though it was up about 2% at one point. The stock has retreated more since then and closed most recently at $8.31. The stock hit a 52-week high of $9.65 earlier this year, well up from the 52-week low of $3.12 almost a year ago.