Short sellers are an interest lot when it comes to investing. After all, they are betting against the stock price in a move that almost feels un-American. That being said, there are many reasons to short sell a stock other than betting a stock is ready to fall. There are also some highly unusual moves seen in the major short interest changes each two weeks.
24/7 Wall St. tracks many top sectors and market segments for short selling. During the period of May 15 to May 31 in 2017, we tracked numerous surprises in the short interest of key stocks. There were nine that stood out well above the rest in our sector-by-sector reviews.
Additional color has been added on each position.
Advanced Micro Devices Inc. (NASDAQ: AMD) saw the number of shares short rise to 158.59 million from the previous level of 146.13 million, for a short interest pop of 8.5%. Interestingly enough, these AMD shares had rallied sharply from $10.90 on June 2 to as high as $12.91 last week before recent wave of profit taking. AMD may still be one of the most shorted Nasdaq stocks, but maybe some of this rally could have been juiced even higher by those short sellers running for cover.
Apple Inc. (NASDAQ: AAPL) has seen its short selling community be accurate here. Its shares had stalled, and there was a 26% gain in the short interest ahead of the last two analyst downgrades and ahead of the big tech-darling sell-off. For the period ended May 31, Apple saw its short interest jump to 63.20 million from the previous level of 49.91 million. Apple’s stock has dropped nearly 8% in the past two trading sessions.
Chesapeake Energy Corp. (NYSE: CHK) has seen its short interest rise in nearly every period so far in 2017. In fact, Chesapeake is now the most shorted NYSE stock again, even though the nominal short interest gain was just by 3%. With a short interest of 167.05 million shares, that represents 18.7% of the entire float, and it would take about five days to cover. The stock had previously closed at $4.97, which is around 29% lower year to date.
Comcast Corp. (NASDAQ: CMCSA) saw its short interest rise about 29% to almost 78.1 million shares at the May 31 settlement date. That was the highest level of short interest in Comcast for at least a year, although it represented 1.7% of the total float. This is also more than a 40% increase in the number of Comcast’s shares short from mid-April.
First Solar Inc. (NASDAQ: FSLR) is supposed to be the king of U.S.-based alternative energy and renewable energy. It saw its short interest decrease by 11.2% to 13.81 million shares. That is still a whopping 18.0% of the company’s float, and despite the drop the days to cover rose from three to four. First Solar’s stock price added less than 4% since then. Its 52-week trading range is $25.56 to $50.40, and it closed at $36.65 on Friday.
Ford Motor Co. (NYSE: F) saw an incredible surge in its short interest for the period ending May 31, on the heels of Ford ousting its chief executive. Ford’s short interest grew to 140.63 million from the previous 116.04 million, an increase of 21% for what is already one of the most shorted NYSE stocks.
General Motors Co. (NYSE: GM) was another massive short seller surprise, but not the same logic at all as in Ford. GM’s short interest fell a sharp 37% to 32,475,512 shares short as of May 31. This is now just 2.4% of the float. Short sellers are no longer pouncing on GM, despite it having been a nothing-burger of a stock since its re-IPO.
Pandora Media Inc. (NYSE: P) is a situation in which short sellers were betting hard against a deal happening. Pandora’s short interest was 78,476,976 shares on May 31, up from 67,116,068 shares on May 15. That 17% gain in the short interest took it to a total of 33.7% of Pandora’s entire float, and it was seven days to cover.
Snap Inc. (NYSE: SNAP) is getting a short selling brigade ahead of the upcoming post-IPO lock-up expiration. There were some 65.53 million shares of Snap sold short at the end of May, up 68% from the 39.01 million shares short in mid-May and representing 17.5% of the entire float. With Snap shares at $18.08 at the end of last week, that is down from a post-IPO peak of $29.44.