Services

Short Sellers Grow Even More Ambitious on Amazon

Amazon.com Inc. (NASDAQ: AMZN) saw its short interest jump for the most recent settlement date of March 31. The number of shares short in this stock has been building up since mid-October, and short sellers have practically doubled their positions since then.

Some 5.06 million shares were short at the end of this two-week period, which was up from the 4.68 million shares on the prior settlement date. The same period of last year had 4.95 million shares shorted.

Note that only six months ago, short interest was only half of where it is now, coming in at 2.51 million shares in October. Also in this same period, Amazon’s stock is up about 6%.

The average daily share volume for Amazon is 2.95 million shares, which would give short sellers about 1.71 days to cover.

24/7 Wall St. recently reported on Amazon:

This is the absolute leader in online shopping, and it remains a technology anchor for many portfolio managers and also is a member of the BofA Securities US 1 list. Amazon.com … serves consumers through retail websites that primarily include merchandise and content purchased for resale from vendors and those offered by third-party sellers.

The company serves developers and enterprises through Amazon Web Services, which provides computing, storage, database, analytics, applications and deployment services that enable virtually various businesses. AWS is also the undisputed leader in the cloud now, and many top analysts see the company expanding and moving up the enterprise information value chain and targeting a larger total addressable market.

Like every year, online sales continued to grow in 2020, especially during the busy Christmas shopping period, and as a result of the COVID-19 shutdowns, and Amazon remains the go-to portal for many shoppers.

Excluding Thursday’s move, Amazon.com stock had underperformed the broad markets with a gain of nearly 4% year to date. However, in the past 52 weeks, the share price was up closer to 65%.

Amazon.com stock traded around $3,419 on Tuesday, in a 52-week range of $2,186.21 to $3,552.25. The consensus price target is $4,009.23.