Mixed Short Interest In Brokerage Stocks (GS, BSC, LEH, MS)

There was no clear direction in the change in NYSE short interest on the major bulge bracket brokerage firms.  If you look at the earnings this week, Goldman Sachs seems to have been the key winner.  Its stock gave back all of its early gains after the earnings were out, but Jim Cramer came out Thursday night on CNBC’s Mad Money to call Goldman the key winner and said it’s going significantly higher by this time next year.

Here is a list of the bulge bracket brokerage firm and investment banker stocks showing the change in the short interest from August to September 2007:

Brokerage Stock            SEPT          AUG       %Change
Goldman Sachs (GS)  10.359M    9.907M        4.56%
Morgan Stanley (MS)    14.226M    16.059M    -11.40%
Merrill Lynch (MER)      23.230M    23.279M     -0.20%
Lehman Bros. (LEH)    25.259M    24.190M     4.40%
Bear Stearns (BSC)     14.636M    12.082M     21.00%

There was a lot of mixed feelings heading into earnings for the brokerage firm stocks this week.  The mixed results in short selling makes sense if you consider the overall environment.

• If you’d like to see the major drop in short selling in banking stocks, here is that report.
• You can also see the drop in the total short interest at the NYSE and AMEX in September.
• We also have a full list showing major stocks short, with housing and retail still getting bets against them.
• We even noted this week about how Goldman showed Bear who daddy is after we had looked over the trading in stocks after other earnings but before theirs.

Jon C. Ogg
September 21, 2007