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The 6 Most Shorted NYSE Stocks: Short Sellers Positive but Cautious

Despite the volatility in the broader markets, short sellers in the top 10 most shorted stocks trading on the New York Stock Exchange seemed positive but cautious, as short interest swings between the August 31 and September 15 settlement dates were mostly mild gains. Vale and Chesapeake Energy held on to the top spots during the two weeks.

Note that the six most shorted NYSE stocks all had more than 115,000 shares short at the end of the most recent settlement period.

There was about a 1% increase in the number of Vale S.A. (NYSE: VALE) shares short during the two-week period to almost 225.79 million. That was the highest level of short interest since last April, when there was a year-to-date peak of nearly 250,000 shares. At the most recent average daily volume, it would take around 10 days to cover all short positions. Vale shares ended the short-interest period more than 2% higher, despite being up 12% at one point. The S&P 500 was flat during that time. The stock closed most recently at $4.68, in a 52-week trading range of $4.13 to $11.95.

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After rising since the end of May, short interest in Chesapeake Energy Corp. (NYSE: CHK) added another 1% or so to almost 220.57 million shares by the middle of month. That was 33.6% of the company’s float, and the days to cover rose to about 13. Revenue was better than expected in the most recent quarter. Short sellers watched the stock climb more than 10% between the settlement dates, though shares have given up most of that gain since. They closed at $7.76 on Thursday. In the past year, shares have traded between $6.01 and $24.43 apiece.

Petróleo Brasileiro S.A. (NYSE: PBR), better known as Petrobras, saw the number of its shares short grow less than 5% in the two weeks to more than 143.76 million. The days to cover was still about four. The year-to-date peak short interest of around 146,000 shares was reached in April. Analysts were increasingly bearish on Petrobras during the most recent period, and shares dropped more than 15% in the first two weeks of September. The stock closed Thursday at $4.14, down more than 43% year to date. The 52-week high of $17.64 occurred last October, while the $3.77 low was seen this week.

Sprint Corp.’s (NYSE: S) short interest shrank less than 2% to about 133.82 million shares in the initial weeks of the month. That was 20.3% of the float and the sixth consecutive period of more than 100,000 shares short. The days to cover jumped from about three to seven. Softbank has continued to increase its stake in Sprint, and the share price ended the two-week period about where it began it, though it has pulled back about 11% since. Shares closed at $4.39 Thursday, in a 52-week range of $3.10 to $6.78.

The more than 129.47 million AT&T Inc. (NYSE: T) shares short in the middle of the month was less than 3% higher than on the prior settlement date. It was the second lowest level of short interest in at least a year, as well as 2.1% of the float. It would take about six days to cover all short positions, the most since mid-July. Merrill Lynch sees AT&T as something of a safe haven from volatility, and shares were fractionally lower by the middle of the month. The stock closed most recently at $32.11, which was more than 4% lower than at the beginning of the year. The 52-week trading range is $30.97 to $36.45.

Transocean Ltd. (NYSE: RIG) saw the number of its shares short in the two-week period shrink about 5% to more than 116.99 million. Short interest had been rising since May, but it has dwindled in the past two periods. The days to cover was about nine by the middle of September, and 32.2% of the float was short. The share price rose almost 16% during the settlement period. They have retreated since, closing at $13.01 on Thursday. Shares have traded between $11.26 and $33.31 in the past 52 weeks.

Rounding out the top 10 were Bank of America Corp. (NYSE: BAC), Ford Motor Co. (NYSE: F), J.C. Penney Co. Inc. (NYSE: JCP) and General Electric Co. (NYSE: GE). The most notable movers were Bank of America and GE, with short interest gains of more than 8%, but to only about 1% of their floats. Peabody Energy Corp. (NYSE: BTU) slipped out of the top 10 in early September.

By Trey Thoelcke