20 Underperforming Stocks Targeted By Short Sellers

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18. Magnolia Oil & Gas Corporation (NYSE:MGY)

Short interest: 14.36%

6 months’ performance: -17%

Magnolia Oil & Gas Corporation operates as an independent natural gas and oil company. The company develops, acquires, explores, and produces natural gas, oil, and natural gas liquids reserves. Its properties are located mainly in the Giddings area and Karnes County.

The company’s short interest may be high, but it is trending downwards. Since October 2024, it has come down from 18.4% to 14.36%. This presents a possible short squeeze opportunity backed by improving fundamentals.

MGY planned spending of nearly half a billion dollars on drilling and completions this year is likely to result in a 5% to 7% production growth. On top of this, efficiency improvements will result in more wells being drilled for the same cost. The company is unhedged and fully exposed to commodity prices as part of the management’s strategy. This could go either way for investors, but if it favors the company, the probability of a bull rally triggered by short covering is quite high.

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