The market gains in early March began to dwindle in the latter half of the month as worries about a potential trade war grew and big tech stocks began to sell off. It was not only the end of the month, but the end of the calendar quarter, so there was little going on in the way of earnings reports to help buoy the markets. 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 March 15 and March 29 settlement dates, those sellers were focused on a few of their favorites. Rite Aid and Ford saw notable rises in the number of their shares sold short in the period. Moves in others featured here were mixed but marginal.
Note that the six most shorted NYSE stocks all had more than 145 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.
Though the number of Chesapeake Energy Corp.’s (NYSE: CHK) shares short shrank about 3% in the most recent period, this oil and gas company remains at the top of the list. The pullback did little to offset the almost 16% rise in the prior period. The just reported short interest of about 204.70 million shares was 22.9% of the total float. At the posted daily average trading volume on the settlement date, it would take about four days to cover all the short positions.
At least one analyst downgraded Chesapeake during the period, as natural gas prices declined. While its share price ended those two weeks about where it began it, the stock was up around 7% at one point. The S&P 500 retreated more than 4% between the settlement dates. The stock ended trading at $3.09 a share on Tuesday, which is more than 24% lower year to date. The 52-week low of $2.53 was seen back in February. Shares have changed hands as high as $6.39 in the past year.
AT&T Inc. (NYSE: T) again comes in at the number two spot with only a marginal decline in its shares short as of the most recent settlement date. The latest reading of around 177.57 million is still down from a year-to-date high of over 193 million shares. Note that the short interest has shrunk in most recent periods. The latest reading represented 2.9% of the company’s float. As of the end of last month, it would take around six days to cover all short positions, after the average daily trading volume increased somewhat.
AT&T continues to be a popular defensive stock for uncertain times, and investors watched the share price pull back about 4%, though it was down around 7% at one point. The shares have recovered a little since then and ended Tuesday’s trading at $35.81 a share, which is down about 7% year to date. AT&T shares have changed hands between $32.55 and $42.70 apiece in the past 52 weeks.
Weatherford International PLC (NYSE: WFT) remains in the third spot on the list as the number of its shares sold short barely declined in the final two weeks of March. That followed a more than 6% rise in the number of its shares short in the previous period. The more than 167.77 million shares reported most recently represented 17.0% of the total float. The days to cover reading ended the period at around eight, after ticking down by one.
At least one analyst saw huge upside potential for Weatherford last month. Yet, short sellers watched the share price pull back around 13% by the end the settlement period. The stock has recovered much of that ground since then and closed most recently at $2.49 a share. That’s up from a recent 52-week low of $2.07. The 52-week high, seen almost a year ago, was $6.59. The stock is still down about 28% year to date.