Tesla Inc Stock, AMD And Valeant - Short Interest Update

Short Interest In Tesla Inc (NASDAQ:TSLA) Stock Inches Up.

Short interest in Tesla Inc (NASDAQ:TSLA) stock was marginally up in the latest reporting period. Short Interest in Tesla stock moved up by over 2%. Short interest rose to 28.7 million shares from 28.07 million shares at the end of July. As a percentage of float, short interest in TSLA stock is still very high, coming in at 24.1%. The days to cover remained at 4 days, which is also high.

Tesla shorts are not having a good time considering that Tesla stock has rallied over 65% this year. Short sellers had piled up losses of $3.7 billion by the end of April and the loss has only increased from then. Shorts lost around $800 million in the two days after Tesla's latest earnings. However, in spite of such losses, shorts continue to remain optimistic, mainly because of Tesla's weak fundamentals and steep valuations. Tesla burns hundreds of millions of dollars in cash, has a huge pile of debt, has an operational risk from Model 3 manufacturing and trades at exorbitant multiples. Tesla produced just over 60,000 vehicles last year and is more valuable than GM or Ford who produce and sell millions of vehicles every year. This is why some shorts like David Einhorn, who have lost millions on bets against Tesla, remain convinced about their short position against Tesla, despite the huge losses.

Tesla stock has been trading lower from its peak since mid-June. The stock had found support from its 100-day simple moving average after it had crashed on disappointing delivery numbers. However, the recent earnings announcement and updates on the Model 3 front have lent strength to the stock.
TSLA Technical chart

Short Interest In Advanced Micro Devices, Inc (NASDAQ:AMD) Down Marginally.

Short interest in silicon chip company Advanced Micro Devices, Inc (NASDAQ:AMD) has come down marginally. Short interest in AMD was down by 4.6 million shares or around 3% to 147.7 million from 152.2 million shares. The shorted shares make up a huge 17% of its total float. Days to cover stood at 2.4 days. Investors continue to remain skeptical of the company's growth potential and consider its valuations too expensive.

After rallying by about 100% in the last one year, the stock has been losing ground in the last one month. AMD stock is down over 15% since its latest earnings, despite posting strong results. AMD stock is currently facing strong resistance from its 100-day moving average. However, analysts still remain bullish on the stock. AMD stock is currently trading below its consensus price target.
AMD Technical chart

Short Interest In Valeant Pharmaceuticals Intl Inc (NASDAQ:VRX) Sees A Massive Spike.

Short interest in Canada based specialty pharma company Valeant Pharmaceuticals Intl Inc (NYSE:VRX) saw a massive jump in the latest reporting period. Short interest shot up by over 37% or 10.8 million shares in the last reporting period, from 28.9 million to 39.8 million shares. Investors are still not convinced about the managements ability to turn around Valeant. Valeant still has over $27 billion debt on its books with a leverage of around seven, which is massive by any standards. And add to that, the company is seeing its revenue and earnings decline. Valeant still carries huge risks.

Valeant stock has sold-off since its second quarter earnings in spite or reporting solid earnings, closing down several lawsuits including two pending cases pertaining to Siliq and Philidor, and reducing its debt burden. Valeant also said that it will achieve its target of reducing its debt burden by $5 billion before March 2018. The company now doesn't have any debt payment till 2020 which should give investors some relief. Valeant stock has been gaining momentum in the last few trading sessions. The stock has found support from its 200-day moving average and MACD has made a bullish crossover. However, Valeant stock is likely to face resistance from its 20-day moving average.
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Kumar Abhishek Kumar Abhishek   on Amigobulls :

Neither Amigobulls, nor any members of its staff hold positions in any of the stocks discussed in this post. The author may not be a certified/registered investment advisor, and the opinions expressed should not be treated as investment advice.

Buying and selling of securities carries the risk of monetary losses.Readers/Viewers are advised to carry out their own due diligence and consult their investment advisors before making any investment decisions.

Neither Amigobulls, nor the author have any business relationship with any of the companies covered in this post.

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