Markit's most shorted 13 January 2015London Reporter: Stephen Durham
Image: Shutterstock
Markit has compiled a global list of the most shorted stocks that are due to release earnings in the week beginning 12 January.
US homebuilder KB Home is the most shorted stock ahead of announcing earnings, with 15.8 percent of shares outstanding, and is joined by fellow homebuilder Lennar Corp which is sixth most shorted with 9 percent of shares outstanding on loan.
KB Home’s shares have decreased 6 percent over the last 12 months in contrast with Lennar Corp’s increasing by 22 percent.
Both KB Homes and Lennar construct and sell single-family styled housing, primarily aimed at first time buyers across the US.
Analyst at Markit, Relte Schutte, commented: “New house sales numbers in the US dropped unexpectedly in November to the lowest levels since July 2014.”
“The outlook for housing in the US for 2015 however is strong but the rapid decline in oil prices and possible future effects on homebuilder’s remains uncertain.”
Overall, the US housing market rallied over Q4 of 2014 after seeing what Markit called a “disappointing” first three quarters.
Another popular short sale in the US ahead of earnings is People’s United Financial. The savings, loan and wealth services company currently has 14 percent of shares outstanding on loan.
Short sellers timed the previous large price decline of 10 percent, which occurred in July, well according to Markit.
Since then the share price has recovered and is up 3.8 percent over the last year, attracting renewed interest from short sellers in recent weeks.
The company in Europe seeing most significant short interest ahead of earnings is German sugar and food producer Suedzucker. The company lowered its dividend payments in 2014 and was removed from the MSCI Germany Index earlier in the year.
Suedzucker’s share price has declined 39 percent over the last 12 months and short sellers have continued to cover, with short interest decreasing month-on-month by 13 percent to 8 percent of shares outstanding on loan.
Japanese auto component manufacturer U-Shin is the most shorted stock in the Asia Pacific region, with 7.8 percent of shares outstanding on loan.
The next most shorted in the region is Singapore Press with 7.6 percent of shares outstanding on loan.
The printer, publisher and multimedia company is the Singapore’s largest newspaper publisher and was recently included in a joint venture announcement with Schibsted, Naspers and Telenor regarding classified websites.
NO FEE, NO RISK 100% ON RETURNSIf you invest in only one securities finance news source this
year, make sure it is your free subscription to Securities Finance Times
Image: Shutterstock 