Tesla Short Interest Over 34 Million Shares

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The short interest in Tesla Inc. (NASDAQ: TSLA) for the period that ended January 31 was 34.4 million shares, a very modest drop of 700,000. However, the number is 28% of Tesla’s float, which means the bet against it still is large.

Tesla’s shares have posted a steady increase this year, which makes the short bets very risky (unless some very bad news hits the company). The stock is up 26% year to date to $269. This is just below a 52-week high.

Many analysts believe Tesla will beat earnings estimates when it quarterly results are released in a few days. Additionally, its inexpensive Model 3 is about to begin production. And the company is about to move into India, a modest car market now, but the world’s second largest nation by population. CEO Elon Musk, according to Reuters, indicated on February 8:

Electric car maker Tesla Inc may enter the Indian market this summer, Chief Executive Elon Musk tweeted on Tuesday.

Replying to a question on Twitter regarding whether Tesla plans to launch in India, Musk tweeted: “Hoping for summer this year.”

If Musk can begin to deliver the Model 3 this year, he can claim Tesla has become a mainstream car company. The price of the car is below $40,000. Tesla says it has 400,000 orders for the car. Tesla has been a niche car company so far, with sales to rich buyers who can manage the price over $80,000, and in some cars over $100,000.

Upcoming earnings may be a test of whether there is demand for its current vehicles. And, by the end of the year, the proof that Tesla has “legs” in the car market will be clearer.