There has been a noticeable rise in short interest in Woolworths (WOW) in the past six weeks. We blogged on Woolworths on October 12. On October 10th the percentage of Market Cap on Loan (MCOL) was 8%, compared to the latest figure of 11.67%.
This is high compared to the rest of the Retail sector, where 4.87% of the market cap is on loan. The graph below compares the last six months’ lending activity in Woolworths (red), the Retail Sector (green) and Woolworths’ share price (orange) - which has continued to plummet since June – down from 28.00GBP then to 15.00GBP today.
Woolworth’s Utilisation has risen by 100% in the last six weeks - from 25% on October 10 to 50% today.
The most borrowed company in the retail sector is HMV (HMV), with 33.72% of its shares on loan . This is a long-standing short, which was one of the most successful shorts in 2006. The group’s Utilisation has risen from 60% in June to 77% today.
Debenhams (DEB), who we blogged on November 5, has the second highest %MCOL at 17.57%, significantly lower than HMV, but a significant increase since June when the figure stood at 2.5% (see graph below.)
JJB Sports (JJB), who recently reported losses after England’s failure to qualify for the European Cup next summer, have the fifth highest %MCOL of 12.24%.
Over in America, electrical consumer store Circuit City (CC) has been a target for shortsellers since June 2007. The share price has fallen from 20USD in January to 6USD today. Shortsellers came late to this trade, but the %MCOL on loan remains very high, putting the company into the top decile in the S&P 500. %MCOL currently stands at 14% and Utilisation is 37%. Circuit City is by no means the most heavily shorted stock in the North American Retail Sector. Urban Outfitters (URBN) is higher at 15.46%, as is booksellers Borders Group (BGP) at 15.29%. Borders has a Utilisation figure of 55.60%, which has risen steadily as the share price fell from 16.00USD to 12.00USD today.
Please click here to read our report on the US Apparel Sector.