Investing

The 6 Most Shorted Nasdaq Stocks: Frontier in the Spotlight

Trey Thoelcke

Published: August 25, 2016 8:10 am

Last Updated: January 13, 2020 4:17 am

In most years, August is the heart of the summer doldrums, but this year the markets are hitting new all-time highs. However, short sellers made very few big moves between the July 29 and August 15 settlement dates, at least when it comes to the most shorted stocks traded on the Nasdaq.

The exception was Frontier Communications, which saw a sharp increase in the number of its shares during the two-week period. Also of note, Intel short interest continues to shrink, though the leading semiconductor chip maker has yet to slip from the top 10 most shorted Nasdaq stocks.

Note that only two Nasdaq stocks still had more than 100 million shares short by the end of the most recent period.

Sirius XM

The more than 221.12 million Sirius XM Holdings Inc. (NASDAQ: SIRI) shares short by the middle of August was less than 4% lower than on the previous settlement date, which was the highest level of short interest in at least a year. Some 4.5% of the company’s float was sold short most recently. At the current average daily volume, it would take more than four days to cover all short positions.

Sirius XM reported late last month that it had topped 25 million subscribers. Its share price ended the two-week period more than 3% lower, after hitting a new multiyear high of $4.44 at the end of July. The Nasdaq was up about 2% in that time. The stock closed most recently at $4.14 a share. The 52-week low is $3.29.

Frontier Communications

The number of shares short in Frontier Communications Corp. (NASDAQ: FTR) had been increasing since April, but after a modest breather in the previous period, it rose again, this time by more than 17% to more than 189.26 million. That was 16.3% of the telecom’s float, as of the most recent settlement date. The days to cover dropped from more than 12 to about eight as the average daily volume surged.

Frontier remains a top stock pick at Deutsche Bank. Short sellers watched the shares sink more than 5% in the short interest period. They have continued to retreat since then, though the share price now is only fractionally lower year to date to $4.66, within a 52-week range of $3.81 to $5.85.
MannKind

MannKind Corp.’s (NASDAQ: MNKD) short interest, at more than 87.81 million shares most recently, was more than 5% higher than on the prior settlement date. That was the greatest number of shares short since May, as well as 27.3% of the total float. The daily average volume rebounded from a year-to-date low, but the days to cover is still about 42.

MannKind posted a deeper than expected net loss during the period. Shares ended the two weeks about 1% lower, though they were down more than 7% at one point. They are now about 40% lower year to date to $0.87, but still up from the multiyear low of $0.64 earlier this year. The 52-week high of $4.07 was seen nearly a year ago.

Micron Technology

The number of Micron Technology Inc. (NASDAQ: MU) shares short, at more than 72.39 million by the middle of the month, was less than 2% higher than in the previous period. And it was 7.0% of the total float, as well as the highest level of short interest so far this year. As the daily average volume in the period decreased, the days to cover grew to more than three.

Buyout rumors have swirled around Micron lately. The stock retreated more than 2% early in the short-interest period but ended the two weeks with about a 13% gain. It increased more than 4% afterward. Shares closed on Wednesday at $15.51, in a 52-week range of $9.31 to $19.30.

AMD

By the middle of month, Advanced Micro Devices Inc. (NASDAQ: AMD) had more than 72.20 million shares short. That was down from almost 75.38 million on the previous settlement date. The latest reading was the second lowest short interest so far this year and totaled 11.2% of the company’s float. The days to cover rose to about three as the average daily volume plunged from a year-to-date high.

During the period, AMD was among stocks that seemed overvalued, even with a sharp pullback early in the month. Yet the ending share price was less than 2% higher than on the previous settlement date. The stock reached a new 52-week high of $8.00 recently, but shares closed at $7.43 on Wednesday. The 52-week low is $1.65.

Opko Health

Opko Health Inc.’s (NASDAQ: OPK) short interest, at around 70.45 million shares as of the most recent settlement date, was up nearly 3% from the previous period. That was 21.6% of the total float. The daily average volume rose during the two weeks, and by the middle of the month, the days to cover had fallen from more than 31 to near 22.

The CEO continues to frequently buy batches of shares, as he has done for more than a year. The stock closed Wednesday at $9.24, in a 52-week range of $7.12 to $11.85. The share price ended the two-week short-interest period a little more than 1% higher, though it has retreated more than 8% since then.

And Others

Rounding out the top 10 were Huntington Bancshares Inc. (NASDAQ: HBAN), Novavax Inc. (NASDAQ: NVAX), Intel Corp. (NASDAQ: INTC) and Cisco Systems Inc. (NASDAQ: CSCO). Moves among these were mixed and mild as well.

Note that short interest surged in Microsoft Corp. (NASDAQ: MSFT) and NVIDIA Corp. (NASDAQ: NVDA), by double-digit percentages, during the two weeks, but not enough to lift them into the top 10. Also lingering just outside the top 10 are Apple Inc. (NASDAQ: AAPL) and BlackBerry Ltd. (NASDAQ: BBRY).