Shorters round on retailers despite Trump bump-up
05 December 2016 London
Image: Shutterstock
US retailer Restoration Hardware has attracted more than double the short interest than any other firm in North America in the week ahead of earnings, according to an IHS Markit research note.
Short sellers interest in the home-furnishing company was peaked by a series of weak earnings results, which saw the Restoration’s shares lose two thirds of their value.
Interest has remained high despite the retailer’s latest earnings submission “outperforming expectations” and the emergence of a post-election rally in retail industry’s shares, explained the research note’s author Simon Colvin.
Retailers made up over half of the most shorted firms analysed by IHS Markit including household names such as Sears, Saks Fifth Avenue owner Husdon’s Bay and Autozone.
The biggest jump in short interest leading up to earnings was with unmanned drone developer Aerovironment, which saw demand to borrow its shares surge by 25 percent over the past month.
Short sellers have more than doubled their positions in Aero, according to IHS Markit.
“This trend shows no signs of slowing down despite the fact that the post-election rally, which has boosted defense related shares, has seen Aero recover most of the ground lost in the wake of its last earnings update.”
Short sellers interest in the home-furnishing company was peaked by a series of weak earnings results, which saw the Restoration’s shares lose two thirds of their value.
Interest has remained high despite the retailer’s latest earnings submission “outperforming expectations” and the emergence of a post-election rally in retail industry’s shares, explained the research note’s author Simon Colvin.
Retailers made up over half of the most shorted firms analysed by IHS Markit including household names such as Sears, Saks Fifth Avenue owner Husdon’s Bay and Autozone.
The biggest jump in short interest leading up to earnings was with unmanned drone developer Aerovironment, which saw demand to borrow its shares surge by 25 percent over the past month.
Short sellers have more than doubled their positions in Aero, according to IHS Markit.
“This trend shows no signs of slowing down despite the fact that the post-election rally, which has boosted defense related shares, has seen Aero recover most of the ground lost in the wake of its last earnings update.”
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