What Do Short Sellers Know About Ford's Dwindling Future?

Cars and Drivers

Published: June 12, 2017 9:55 am

Last Updated: January 12, 2020 11:08 am

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Ford Motor Co. (NYSE: F) saw an incredible surge in its short interest for the most recent period. This comes on the heels of Ford ousting its chief executive and naming the head of its autonomous car division to replace him.

For the period ending on May 31, Ford’s short interest grew to 140.63 million from the previous level of 116.04 million. This is a whopping increase of 21% for what is already one of the most shorted stocks on the New York Stock Exchange.

The 140.63 million shares short represents 3.6% of the total float, and it was the fifth time this year that short interest was more than 100 million shares. It still would take three days to cover all short positions, as of the latest settlement date.

To kick off June, Ford reported a U.S. sales increase of 1.2% year over year in May, to 241,126 Ford and Lincoln vehicles, compared with May 2016 sales of 235,997. Passenger car sales fell 10% in the month of May.

Truck sales rose 9.4% for the month, and sales of F-Series pickups soared by 12.8%. Retail sales dropped 0.2% in May to 158,282 and fleet sales rose 8.4% to 82,844 units.

Total sales compare to an estimate of 232,000 by analysts Kelley Blue Book, which also estimated an average transaction price of $38,428, up 5% year over year and down 1.1% compared with April’s average selling price.

Over the course of 2017, Ford has underperformed the broad markets, with the stock down nearly 8%. In the past 52 weeks, the stock is actually down over 15%.

Shares of Ford were trading at $11.19 on Monday, with a consensus analyst price target of $12.85 and a 52-week range of $10.67 to $14.04.

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