Market Overview

Zoom Video, Alibaba Among Most Profitable Shorts Since Election Day

Zoom Video, Alibaba Among Most Profitable Shorts Since Election Day

The S&P 500 is off to a very hot start to the month of November, propelled by a favorable election outcome and a promising Pfizer Inc. (NYSE: PFE) coronavirus vaccine candidate. However, some stocks have performed better than others so far in November, and short sellers have still made a killing in a handful of stocks this month.

Rotation Out Of Tech: Investors have rotated out of big tech growth names since the election after more than a decade of tech leading the market higher. According to Ortex Analytics analyst Peter Hillerberg, short sellers are down more than $5.5 billion month-to-date in November.

“This rapid swing in sentiment has caught many short sellers off guard, leading to significant losses so far in November. However, these losses would have been far worse had it not been for pockets of profit, for example among tech stocks,” Hillerberg said Wednesday.

Despite the booming overall market, short sellers have made at least $364,000 in net profits on 10 different stocks in November, according to Ortex.

Related Link: Nio, Peloton Among Analyst's Top Short Squeeze Candidates

Most Profitable Shorts: Here’s a list of the 10 most profitable shorts so far this month, sorted by the net profits short sellers have logged through Nov. 9:

  1. Zoom Video Communications Inc (NASDAQ: ZM), $999.6 million in profit.
  2. Wayfair Inc (NYSE: W), $936.7 million in profit.
  3. Tesla Inc (NASDAQ: TSLA), $460.1 million in profit.
  4. Teladoc Health Inc (NYSE: TDOC), $457.6 million in profit.
  5. Sea Ltd (NYSE: SEA), $449.4 million in profit.
  6. Alibaba Group Holding Ltd - ADR (NYSE: BABA), $448.4 million in profit.
  7., Inc. (NASDAQ: AMZN), $420.7 million in profit.
  8. Netflix Inc (NASDAQ: NFLX), $416.4 million in profit.
  9. Peloton Interactive Inc (NASDAQ: PTON), $375.8 million in profit.
  10. Square Inc (NYSE: SQ), $364.3 million in profit.

Benzinga’s Take: The short tech trade reversed on Wednesday morning, with the Nasdaq up 1.7% and the Dow Jones Industrial Average up just 0.2% in midday trading.

Traders will be watching the market closely in the coming days to determine whether or not the short growth trade has run its course or whether November’s trading action is just the beginning of a longer-term rotation out of tech stocks with bloated valuations.

Latest Ratings for ZM

Dec 2020JP MorganDowngradesOverweightNeutral
Dec 2020RBC CapitalMaintainsOutperform
Dec 2020StifelMaintainsHold

View More Analyst Ratings for ZM
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