The 6 Most Shorted NYSE Stocks

March 27, 2018 by Trey Thoelcke

Concerns about inflation and rising rates in this nine-year-old bull market were joined at the beginning of this month by fresh worries about a trade war as the administration announced new tariffs aimed especially at China. Volatility understandably spiked again. However, sell-offs can be good for short sellers, depending on how they are positioned and how nimble they are.

Judging by the most shorted stocks traded on the New York Stock Exchange between the February 28 and March 15 settlement dates, those sellers were stocking up, as they all saw short interest rise. Drugmaker Pfizer led that trend, with the number of its shares sold short more than doubling in the period. Rite Aid and General Electric also saw double-digit percentage growth in short interest during those two weeks.

Note that the six most shorted NYSE stocks all had more than 140 million shares short at the end of the most recent settlement period. In fact, all the top 10 had short interest of more than 100 million shares.

Chesapeake Energy

The number of Chesapeake Energy Corp.’s (NYSE: CHK) shares short has risen in many periods in the past year, and in the latest period it clung to the top spot on this list with a rise of almost 16%. The short interest of more than 211.09 million shares was 23.6% of this oil and gas company’s float. At the posted daily average trading volume on the settlement date, it would take about seven days to cover all the short positions.

Chesapeake wowed investors with its most recent quarterly results. While its share price ended that two-week period more than 6% lower, the stock had been up more than 12% at one point. The S&P 500 saw a little more than 1% gain between the settlement dates. The stock ended trading at $3.12 a share on Monday, which is almost 24% lower year to date. The 52-week low of $2.53 was seen last month. Shares have changed hands as high as $6.59 in the past year.

AT&T

AT&T Inc. (NYSE: T) again comes in at the number two spot with about a 2% increase in its shares short as of the most recent settlement date. The latest reading of more than 178.15 million is still down from a year-to-date high of over 193 million shares. In fact, the short interest has shrunk in most recent periods. The latest reading represented 2.9% of the company’s float. As of the middle of this month, it would take around nine days to cover all short positions, after the average daily trading volume fell somewhat.

AT&T continues to be a popular defensive stock for uncertain times, and investors watched the share price rise almost 4% but end the period up less than 1%. The shares have retreated more since then and ended Monday’s trading at $34.69 a share, which is down about 10% from year to date. AT&T shares have changed hands between $32.55 and $42.70 apiece in the past 52 weeks.

Weatherford

Weatherford International PLC (NYSE: WFT) remains in the third spot on the list despite a more than 6% rise in the number of its shares sold short in the initial two weeks of March. That recovered much of a 9% retreat in its short interest in the previous period. The more than 168.73 million shares reported most recently represented 17.2% of the total float. The days to cover reading ended the period at around nine, as the average daily volume shrank somewhat.

At least one analyst saw huge upside potential for Weatherford between the latest settlement dates. Short sellers watched the share price seesaw between down more than 6% and up almost 7%, only to end the period just fractionally higher. The stock closed most recently at $2.41 a share, after hitting a 52-week low of $2.19 earlier in the day. The 52-week high, reached last April, was $6.86. The stock is now down more than 30% year to date.

General Electric

General Electric Co. (NYSE: GE) saw the number of its shares short jump nearly 14% in the first two weeks of the month to a year-to-date high of more than 155.34 million. The figure reported most recently represented 1.8% of the conglomerate’s total float. The daily average volume dwindled again, but the days to cover reading ended the period still at about two.

Analysts increasingly anticipate that GE’s dividend and earnings potential are at risk. Shares ended the short interest period about 2% higher, despite being up almost 9% at one point. In those two weeks, the Dow retreated fractionally. GE’s share price was last seen at $12.90, after sinking to a 52-week low of $12.73 earlier in the day. The 52-week high, which was reached last April, was $30.54 a share. The stock now is more than 28% lower year to date.

Rite Aid

The reported number of Rite Aid Corp. (NYSE: RAD) shares sold short leaped from more than 117.74 million to almost 146.52 million as of the most recent settlement date, lifting it into the top six once more. The latest figure was 13.9% of the company’s total float, as well as the highest level of short interest since early in the year. The average daily trading volume shrank in the most recent period, and the days to cover rose from about two to five.

Rite Aid continued to sell assets to Walgreens this month. Rite Aid’s share price was about 2% higher early in the period, but it could not hold on to the gain and ended the first two weeks of March down more than 14%. The stock closed most recently at $1.49 a share, which was around 30% lower compared with the beginning of the year. Rite Aid shares have traded between $1.38 and $4.87 apiece in the past 52 weeks.

Pfizer

The more than 142.87 million Pfizer Inc. (NYSE: PFE) shares short by mid-March was more than double the almost 61.82 million on the prior settlement date. It represented 2.4% of the pharma giant’s total float, and that was the first time this year that the stock made the top 10 most shorted NYSE stocks list. As of the latest settlement date, it would take about six days to cover all short positions.

Pfizer recently sold its schizophrenia treatment to Biogen. Shares were up more than 1% by the end of the most recent short interest period, but that was better than the Dow in that time. The stock sank almost 4% in the past week and closed most recently at $35.04 a share. That was less than 4% lower than at the beginning of the year. The 52-week trading range is $31.67 to $39.43.

And the Rest

Rounding out the top 10 were Bank of America Corp. (NYSE: BAC), Ford Motor Co. (NYSE: F), Alibaba Group Holding Ltd. (NYSE: BABA) and J.C. Penney Co. Inc. (NYSE: JCP). Among these four, there was almost no change in Alibaba’s short interest, but the others all saw notable increases in the number of their shares short.

Sprint Corp. (NYSE: S) was pushed out of the top 10 most shorted stocks, and trailing after it on the most recent settlement date were Vale S.A. (NYSE: VALE) and Ensco Corp. (NYSE: ESV).

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