The difficult state of the macroeconomic environment in 2022 has had a negative impact on the performance of a number of equity investments. Worries about a recession and a bearish attitude among investors have been especially unsettling for companies with weak financial positions.
In the face of adverse market circumstances, this risk-averse mentality has also pushed short sellers to increase the stakes of their bets. Finbold has taken a look at the ten stocks that had the highest number of short positions as of November, according to data from Statista, offering an overview of the stocks that are now on the watch list for short sellers.
Notably, Tricida Inc. (NASDAQ: TCDA), an American pharmaceutical firm, was the most shorted stock as of November 2022, with 42.59% of its entire float shorted.
The second most shorted stock as of November 2022, with 40.94% of the float shorted, was Beyond Meat Inc (NASDAQ: BYND), while marginally behind in third was Bed Bath & Beyond Inc (NASDAQ: BBBY) with 40.33%, respectively.
1. Tricida Inc. (NASDAQ: TCDA) – 42.59% short interest
Volume has been considerably higher in the last couple of days, which investors want to see during a strong upward movement. In the previous month, TCDA has been trading between the $0.19 – $0.36 range, which is quite broad. It is moving in the middle of this range so that some resistance may be found above.
2. Beyond Meat Inc (NASDAQ: BYND) – 40.94% short interest
Beyond Meat is currently trading near the lower end of its 52-week range, which is not a good sign as it is lagging behind the S&P500 Index. In the last month, BYND has been trading in the $11.56 – $17.23 range which is quite wide and currently trading near the lows of this zone.
Support is located at $12.62 from a horizontal line in the weekly time frame, while a resistance area can be observed at $15.70 from a horizontal line in the daily time frame.
3. Bed Bath & Beyond Inc (NASDAQ: BBBY) – 40.31% short interest
When comparing the yearly performance of all stocks, BBBY is a bad performer in the overall market, with 96% of all stocks doing better. The long and short-term trends are negative, with the stock in the last month trading from the $2.96 – $4.78 range.
4. Carvana Co (NYSE: CVNA) – 40.22% short interest
In the last month, the Fortune 500 top gainer has been trading between $6.50 – $16.07 and is currently near the lows of this range. The short- and long-term trends are negative, with the stock trading below all its daily moving averages. Resistance is observed at $8.13 from a horizontal line in the daily time frame.
5. Allogene Therapeutics Inc (NASDAQ: ALLO) – 38.68% short interest
ALLO, in the last month, has been trading in the $8.46 – $11.10 range and is currently changing hands in the middle of this area, so some resistance may be found above, particularly at $12.66 from a trend line in the weekly time frame.
The short-term trend is neutral, while the long-term trend is still negative, so traders would be prudent to wait to see a little more continued positive action before making any entries.
6. Vertex Energy Inc (NASDAQ: VTNR) – 37.51% short interest
Compared to the performance of all stocks over the last year, it is clear that VTNR has been one of the most successful companies on the market. It has outperformed 96% of all other stocks. However, most of this total performance may be attributed to the significant movement around seven months ago. VTNR is changing hands in the middle of its 52-week range in line with the S&P500 Index.
Currently, there is a support zone below the current price of around $7.87, where a Stop Loss order might be put due to the decreased volatility as prices have been consolidating lately.
7. PMV Pharmaceuticals Inc (NASDAQ: PMVP) – 37.19% short interest
PMVP has a performance that is about average in the biotechnology category, but it has performed better than 44% of the other 631 companies in the same industry.
PMV Pharmaceuticals has been trading in a pretty broad range, ranging from $9.19 to $13.02 over the last month, and it is presently moving around the lower end of this range.
8. AST SpaceMobile Inc (NASDAQ: ASTS) – 36.09% short interest
ASTS has been trading between $6.20 to $10.21 during the last month and is presently trading around the lower end of that scale. AST SpaceMobile Inc saw its share price increase by more than 10% when the stock market closed on November 7 as the company was the center of some unusual options activity.
Considerably lower volume is observed in the last couple of days, and both the long and short-term trends are negative; the first resistance zone is at $6.06 from a horizontal line in the daily time frame.
9. Upstart Holdings Inc (NASDAQ: UPST) – 35.69% short interest
UPST has been trading in the $14.02 – $25.14 range over the last month. Given Upstart is currently trading in the middle of this range, some resistance may be found above. The intersection of various trend lines over multiple time frames has resulted in forming a resistance zone with a band that extends from $18.52 to $18.61.
Recent evolutions are not that positive, and both the medium and short-term picture give negative signs, with stock trading below all its moving averages.
10. Mullen Automotive Inc (NASDAQ: MULN) – 35.33% short interest
Mullen is a bad performer in the overall market, and both the medium and short-term pictures are negative. MULN is part of the automobile industry, and there are 33 other stocks in this sector, of which 82% are performing better than Mullen Automotive.
MULN has been trading between the $0.19 – $0.46 range in the last month. Since it is currently trading near the lows of this range and prices have been falling strongly lately, it is better to avoid new long positions here.
All in all, the weak balance sheets or business models of all the firms that made the list of the most shorted stocks were red flags for short sellers. Bear in mind that engaging in short selling is a high-risk venture that should be approached with due diligence.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.