Market Overview

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.

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 (NASDAQ: 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. (NASDAQ: MYGN), with 42.5 percent of its float sold short, and 46 days to cover.

Theravance Inc (NASDAQ: 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 (NASDAQ: 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 (NASDAQ: 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 (NASDAQ: TKAI), which recently saw short interest surge from 43.3 percent of the float, to 49.3 percent of the float.

Posted-In: Eun K. Yang JefferiesBiotech Short Ideas Health Care Movers Trading Ideas General

 

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