Short-Sellers Betting Against These Biotechs

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Many investors keep track of short interest to determine the market sentiment related to a particular stock. Changes in short interest reflect variations in sentiment.

This article will look into a few biotech companies with high short interest ratios.

The Industry

In a recent report, Jefferies analyst Eun K. Yang notes that, as of June 30, weighted average short interest levels fell 0.4 percent for large-cap biotech stocks, 0.2 percent for mid-caps (with market caps between $2 billion and $10 billion), 0.5 percent for small-mid-caps ($500 million - $2 billion), and 0.1 percent for micro-caps.

On the other hand, short interest for small-caps surged slightly (less than 0.1 percent). See Chart 1 for further detail.

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Most Shorted Stocks

Large-cap biotech stocks are not particularly shorted. However, among mid-caps, a few companies stand out for their high short interest rates.

According to Jefferies’ report, the most shorted biotech mid-cap stock (despite a slight decline in short interest) is MannKind Corporation MNKD’s, which recently saw 44.9 percent of its float sold short, and 35 days to cover.

Related Link: Most & Least Shorted Stocks Ahead Of Earnings

Second in line is Myriad Genetics, Inc. MYGN, with 42.5 percent of its float sold short, and 46 days to cover.

Theravance Inc THRX is also very shorted, with 33.7 percent of its float sold short, up from a previous 33.0 percent. Days to cover ascend to 45.

In the smid-cap segment, Sarepta Therapeutics Inc SRPT leads the list, with 38.0 percent of its float sold short (down from a previous 43.1 percent) and 14 days to cover.

Related Link: These 3 Stocks Are Seeing Short-Selling Activity Rise

Also among the most shorted is Enanta Pharmaceuticals Inc ENTA, with 31.9 percent of its float sold short (down from 36.4 percent) and 9 days to cover.

Finally, within small-caps, investors seem most bearish on Tokai Pharmaceuticals Inc TKAI, which recently saw short interest surge from 43.3 percent of the float, to 49.3 percent of the float.

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Posted In: BiotechShort IdeasHealth CareMoversTrading IdeasGeneralEun K. YangJefferies
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