To the untrained eye, there are lots of metrics for Facebook Inc (NASDAQ:FB) readers to watch, but it is useful to take note of a stock’s short interest. Two metrics we can use are: (a) the percentage of a stock’s tradable shares that short sellers are currently short selling, in addition to (b) the change in shorting activity.
Augmented short selling typically indicates what it implies: the Street has turned less fond of a company. Overselling, though, sometimes has a positive effect on stock price, as short-ers may be forced to cover their shares.
At Insider Monkey, it is not a secret that we watch hedge fund interest, but it is also important to pair this information with overall short sale information. In certain instances, mega- investors might share that they’re bearish on a stock, but it’s not an SEC requirement. Nonetheless, some individual investors might wish to stay away from heavily short sold stocks with elevated hedge fund interest, while others might want short-squeeze candidates. For those looking for a time-tested piggybacking strategy, discover the details of our premium strategy.
Let’s take a look at the recent info swirling around Facebook Inc (NASDAQ:FB).
Tracking the latest FINRA short interest data, which is reported twice every month, we can realize that Facebook Inc (NASDAQ:FB) sports a short interest of 2.00% of float. This is a modest increase from the previous filing period. With a float of 1.48B shares, this reveals a short ratio of 0.80.
It’s also important to monitor hedge fund holdings from their 13F filings. According to our data, D. E. Shaw’s D E Shaw had the biggest position in Facebook Inc (NASDAQ:FB), worth close to $194.5 million, accounting for 0.5% of its total 13F portfolio. On D E Shaw’s heels is Columbus Circle Investors, managed by Donald Chiboucis, which held a $154.6 million position; 1.2% of its 13F portfolio is allocated to the company. Some other hedge funds with similar optimism include Jim Simons’s Renaissance Technologies, Leon Cooperman’s Omega Advisors and Patrick McCormack’s Tiger Consumer Management.
Also, insider purchases made by high-level executives is particularly usable when the company in question has experienced transactions within the past half-year. Over the latest 180-day time frame, Facebook Inc (NASDAQ:FB) has seen zero unique insiders buying, and 9 insider sales (see the details of insider trades here).
Let’s check out activity in other stocks similar to Facebook Inc (NASDAQ:FB). These stocks are Yandex NV (NASDAQ:YNDX), Google Inc (NASDAQ:GOOG), LinkedIn Corp (NYSE:LNKD), Yahoo! Inc. (NASDAQ:YHOO), and Baidu.com, Inc. (ADR) (NASDAQ:BIDU). This group of stocks belong to the internet information providers industry and their market caps are closest to FB’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Yandex NV (NASDAQ:YNDX)||23||0||0|
|Google Inc (NASDAQ:GOOG)||148||0||11|
|LinkedIn Corp (NYSE:LNKD)||40||0||13|
|Yahoo! Inc. (NASDAQ:YHOO)||66||0||3|
|Baidu.com, Inc. (ADR) (NASDAQ:BIDU)||29||0||0|
This trio of tools–short interest info, hedge fund holdings and insiders’ behavior–are what all investors should track. Although it’s difficult to find a usable strategy from short sale data, the latter two give plenty of market beating opportunities if you know where to look.