As the rough first quarter wound to a close, it appeared that the markets were finally headed north again, with the Dow Jones Industrial Average and S&P 500 returning to the black for the first time since the beginning of the year. And some moves in the most heavily shorted stocks traded on the New York Stock Exchange were sizable between the March 15 and March 31 settlement dates.
To the upside, General Electric led the way, with a surge in the number of its shares sold short pushing it to the number three spot on the list. On the other hand, short sellers fled from Chesapeake Energy and Freeport-McMoRan, though these stocks did not did not drop out of the top 10 before the end of the month.
Note that the 10 most shorted NYSE stocks all had more than 115 million shares short at the end of the most recent settlement period.
After surging more than 85% in the previous period, Pfizer Inc.’s (NYSE: PFE) short interest hardly changed at all. About 323.94 million shares were short by the conclusion of last month. That was 5.2% of the float, and still the greatest number of shares short in at least a year. The days to cover remained about seven, even as the average daily volume increased. Pfizer’s planned merger with Allergan looked increasingly unlikely during the period, and the share price ended the two weeks only fractionally higher. The Dow was up more than 2% in that time. Pfizer shares closed most recently at $31.89, in a 52-week trading range of $28.25 to $36.46. The stock is still down more than 1% year to date, despite a strong showing in the past couple of weeks.
Sprint Corp.’s (NYSE: S) short interest grew about 7% in the final weeks of March, up from the smallest number of shares short year to date in the previous period. The more than 200.73 million shares reported most recently totaled 32.2% of the float. The days to cover rose from about eight to about 11 as the daily average volume decreased. Sprint made our list of big companies with broken business models. Its share price ended the two-week period about 2% lower, though it was down more than 11% at one point. The S&P 500 gained more than 2% during the two weeks. The stock closed most recently at $3.43, in a 52-week range of $2.18 to $5.39.
The short interest in General Electric Co. (NYSE: GE) jumped more than 36% to the highest level year to date, or about 168.93 million shares as of the most recent settlement date. That was 1.8% of the iconic conglomerate’s float, and it still would take more than five days to cover all short positions. Recent weakness in the dollar is seen as helping companies like GE, and the share price ended the short interest period up more than 5% to a multiyear high of $32.05. It pulled back afterward and closed Monday at $30.71 most recently. The 52-week low of $19.37 was seen last August.
The number of Vale S.A. (NYSE: VALE) shares short shrank by almost 2.5 million in the two weeks to around 168.93 million. That was the lowest level of short interest in the past year. At the most recent average daily volume, it would take about five days to cover all short positions. The Brazilian miner’s former CEO died in a plane crash in March. Short sellers saw Vale’s shares rise nearly 19% during the short-interest period, much of that gain in the first few days. The stock closed most recently at $4.88, up more than 48% year to date. The share price has ranged from $2.13 to $9.14 in the past 52 weeks.
A more than 7% gain brought Ford Motor Co.’s (NYSE: F) number of shares short to about 167.77 million at the end of the settlement period, or 4.3% of the total float. Short interest has been rising since last November, and this was the fifth straight period above 100 million. The days to cover rose to about six as of the most recent settlement date. Ford is another company expected to benefit from the weak dollar. Its share price was both up about 4% and down almost 3% during the period, before landing on a 2% gain as of March 31. Ford shares have changed hands between $10.44 and $16.10 apiece in the past year, and they were trading at $12.66 on Monday’s close.
Rounding out the top 10 were Alcoa Inc. (NYSE: AA), Chesapeake Energy Corp. (NYSE: CHK), Freeport-McMoRan Inc. (NYSE: FCX), SunEdison Inc. (NYSE: SUNE) and Transocean Ltd. (NYSE: RIG). Of these, only SunEdison saw a gain in the number of shares short, up to more than 40% of its float. As mentioned, short interest in Chesapeake Energy and Freeport-McMoRan plunged, by about 26% and almost 11%, respectively, during the two-week period. Short sellers also fled from Petróleo Brasileiro S.A. (NYSE: PBR), better known as Petrobras, allowing it to slip out of the top 10.
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