Investing

The 6 Most Shorted NYSE Stocks

Wikimedia Commons (Alex Proimos)

For all the volatility returning to the markets after the doldrums of August, there was little change among the top few most shorted stocks traded on the New York Stock Exchange between the August 31 and September 15 settlement dates. Making a run toward the top of the list, however, was Freeport-McMoRan, and to a lesser extent Alibaba. They pushed aside Bank of America, which was the big riser in the previous period.

Note that all the top six stocks on the list had more than 110 million shares short at the end of the most recent settlement period.

Sprint

For the second period in a row, short interest in Sprint Corp. (NYSE: S) stayed essentially flat between the settlement dates. The approximately 154.37 million shares short reported most recently totaled 24.4% of the float. But the days to cover dropped from 11 to around six as the daily average volume surged in the initial weeks of the month.

24/7 Wall St. took a look at Sprint’s sky-high valuation during those two weeks. The share price ended the short interest period less than 10% above where it began it, though it was up about 12% at one point. The shares pulled back after the settlement date and closed most recently at $6.65. The stock hit a 52-week high of $7.03 last month, well up from the 52-week low of $2.18 early in the year.

Ford

Following a more than 5% gain in the previous period, the short interest in Ford Motor Co. (NYSE: F) pulled back a little, less than 2%, bringing the number of its shares short to more than 149.74 million by the middle of the month. That represented 3.8% of the total float, down from a high of about 4.4% in mid-March. It would take about six days to cover all short positions.

Ford’s investor day presentation this month offered a look at where the company is headed in terms of new car technologies. But the share price retreated almost 4% in the two weeks, while the S&P 500 slipped about 1%. Ford shares have changed hands between $11.02 and $15.84 apiece in the past year. They were trading at $12.01 on Monday’s close, which is down almost 15% year to date.

Vale

The number of Vale S.A. (NYSE: VALE) shares short grew by less than 41,000 during the period, or hardly at all, to more than 128.61 million. However, that broke six periods in a row of shrinking short interest. At the most recent average daily volume, it would take about five days to cover all short positions.

Shares of this Brazilian miner were recently upgraded at Barclays. Vale’s shares pulled back more than 4% during the short-interest period, though they were up more than 8% early on. They closed most recently at $5.38. That is up more than 63% year to date but nearly 32% higher than a year ago. The share price has ranged from $2.13 to $6.26 in the past 52 weeks.

GE

In contrast to the retreat by more than double-digit percentages in the July and early August periods from the highest level year to date, the short interest in General Electric Co. (NYSE: GE) stayed essentially flat most recently, landing at nearly 116.95 million shares by mid-month. That was 1.3% of the iconic conglomerate’s float, and it would take more than three days to cover all short positions.

24/7 Wall St. pointed to GE as one of the stocks dragging down the Dow this year. The share price ended the two-week short interest period more than 4% lower, while the Dow Jones Industrial Average was down only about 1% in that time. GE shares have been essentially flat since then, and they ended most recently at $29.54. They have traded between $24.26 and $33.00 in the past year.

Freeport-McMoRan

The number of shares short in Freeport-McMoRan Inc. (NYSE: FCX) surged almost 12% to more than 114.92 million as of the most recent settlement date. Some 8.8% of the miner’s float was sold short after the first two weeks of the month, but note that short interest was more than 20% of float early in the year. It would take about three days to cover all short positions.

Freeport made a big asset sale this month, and short sellers watched the shares rise more than 7% but end the short interest period down about 5%. The stock closed most recently at $10.51 per share, which is up more than 55% year to date. The 52-week low is $3.52, well short of the 52-week high of $14.20.

Alibaba

Alibaba Group Holding Ltd. (NYSE: BABA) saw its short interest grow more than 5% to almost 114.06 million shares by the middle of September. That was 4.6% of the float, the highest level in the past year. As of the most recent settlement date, it would take more than six days to cover all short positions, after the average daily volume shrank somewhat.

CEO Jack Ma reportedly was promoting free trade at the G20. Short sellers watched the share price rise more than 7% between the settlement dates and another 3% or so afterward. The stock closed most recently at $105.89, after hitting a 52-week high of $109.76 last week. The 52-week low is $57.20.

And the Rest

Rounding out the top 10 were Chesapeake Energy Corp. (NYSE: CHK), Alcoa Inc. (NYSE: AA), Transocean Ltd. (NYSE: RIG) and Bank of America Corp.’s (NYSE: BAC). The mover among them was Bank of America, with a more than 16% drop in short interest that wiped out the surge in the previous period and then some.

Still lingering outside the top 10 were Host Hotels & Resorts Inc. (NYSE: HST), Fiat Chrysler Automobiles N.V. (NYSE: FCAU) and AT&T Inc. (NYSE: T). Note that Procter & Gamble Co. (NYSE: PG) had a huge increase in the number of its shares short, but it fell short of breaking into the top 10.

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