New Microsoft Short Data Worth Watching – What Happened After The March Surge?

Benzinga recently spoke with Karl Loomes, Market Analyst at SunGard's Astec Analytics, about short interest in the current market. Among a list of high profile stocks, the specialist considers Microsoft Corporation MSFT to be the most interesting one, after experiencing a marked surge in short interest over March.

Looms says: “looking at Microsoft, data form SunGard’s Astec Analytics hints at some growing optimism on the part of short sellers recently. Though most of March saw the number of MSFT shares being borrowed – a proxy for short selling – increasing, towards the end of the month this pattern began to change.”

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He continues to explain that, it seems that as Microsoft’s share price fell, “this side of the market covered their positions and so were not expecting the stock to fall further. Tellingly, as the price did start to recover in April, borrowing activity remained low – hinting that short sellers are effectively agreeing with the cash market.”

One fact that backs up Looms’ words: “since its peak in late March, we have seen the number of MSFT shares being borrowed fall 44%.”

Shares of Microsoft are up 5 percent since the beginning of the month, after falling 7.29 percent over March, and more than 8 percent since the beginning of 2015.

Analysts seem to disagree about the stock. Citigroup recently reiterated a Sell rating, while Barclays maintains an Overweight, and Wells Fargo upgraded it to an Outperform.