Short Sellers Lose Interest In eBay, Google, LinkedIn

Many of the leading social media companies based in the United States saw the short interest in their shares decline between the January 15 and January 30 settlement dates. Chief among them were eBay Inc EBAY, Google Inc GOOGL A shares and LinkedIn Corp LNKD. Below we take a quick look at how these three stocks have fared recently and what analysts expect from them. That is followed by a glance at the short interest trend in other social media stocks.

eBay

Short interest in this San Jose, California-based online commerce company shrank by more than 11 percent to around 14.96 million shares in late January, or more than 1 percent of the float. That was the fewest number of shares short in the past year. The days to cover fell to a little more than one. eBay has a market capitalization near $66.7 billion. It posted mixed quarterly results and announced layoffs in the period. The long-term earnings per share (EPS) growth forecast is almost 11 percent. The operating margin is better than the industry average, but the return on equity is in the red. Of the 41 analysts who follow the stock that were surveyed by Thomson/First Call, 18 recommend buying shares, with 10 of them rating the stock at Strong Buy. The mean price target, or where analysts expect the share price to go, is about 6 percent higher than the current share price. Short sellers watched the share price rise more than 7 percent but give it all back during the two-week settlement period. The stock is down about 2 percent year to date, and it has underperformed competitors Amazon.com and Overstock.com, as well as the broader markets over the past six months. Why Facebook Is Still The Better Bet, Even After Twitter's Spectacular Results

Google

Short interest in A shares of this Mountain View, California-based operator of Google+ and YouTube declined more than 14 percent, more than erasing the 9 percent gain in the previous period. The nearly 2.82 million shares short on January 30 was about 1 percent of the total float. Analysts are looking for double-digit percentage growth of revenue for both the current quarter and the full year. Google's long-term earnings per share (EPS) growth forecast is more than 15 percent. It has a market cap near $366 billion. Note that class A shares include voting rights. For at least three months, the consensus recommendation of analysts surveyed has been to buy these shares. Of the 49 analysts polled, 16 rate the stock at Strong Buy. They believe the shares have plenty of head room, as the mean price target is more than 13 percent higher than the current share price. The share price ended the two-week period more than 6 percent higher, compared to up less than 2 percent for the Nasdaq. But the stock has been flat since and is up about 1 percent year to date. It has underperformed the Facebook and Yahoo over the past six months, as well as the broader markets.

LinkedIn

Short interest in this online professional network operator tumbled more than 26 percent to around 5.79 million shares in the final two weeks of the month. That was the first time short interest had been under 6 million since July, and it represented more than 5 percent of the float. Days to cover is less than five. In late January, an analyst praised LinkedIn for its enterprise prospects. The Mountain View, California-based company has a market cap of near $33.4 billion. The long-term EPS growth forecast is more than 36 percent, but the return on equity is in negative territory. Of the 38 polled analysts, 28 recommend buying shares, while the rest recommend holding them. The mean price target is almost 8 percent higher than current share price and would be a new 52-week high. At least one analyst sees LinkedIn reaching $331 a share, suggesting about 19 percent upside. Shares saw a gain of more than 5 percent during the short interest period, and they have risen more than 19 percent since and hit a new multiyear high this week. Over the past six months, the stock has outperformed the likes of Facebook and Google, as well as the broader markets. Social Sentiment Alert: AOL Looks A Lot Like Twitter And LinkedIn

And Others

Short interest also declined in Google C shares, Groupon, Pandora, Twitter and United Online as a volatile month in the stock market drew to a close. The number of Angie's List shares short was about the same at the beginning and end of the period, and short sellers moved on Facebook, MeetMe, Shutterfly, Yelp and Zynga somewhat during the period. Furthermore, note that the number of U.S.-listed shares (or ADSs) sold short of Chinese social media companies Baidu, Renren and Sohu.com Sina, Weibo and YY declined late in January, while short interest in Youku Tudou increased. At the time of this writing, the author had no position in the mentioned equities. Keep up with all the latest breaking news and trading ideas by following Benzinga on Twitter.