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What Do Cimarex’s Short Interest and Institutional Ownership Trends Mean?

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Jun. 17 2016, Published 12:58 p.m. ET

Short interest in XEC shares

On June 14, 2016, Cimarex Energy’s (XEC) short interest stood at ~3 million shares. This represents the number of shares that have been sold short but have yet to be closed out.

On June 15, 2016, Cimarex’s short interest as a percentage of its float, or short interest ratio, was 3.2%. This compares to 5% on March 31, 2016. So, since the end of 1Q16, Cimarex’s short interest has declined by 36%.

Cimarex’s stock price during these two periods was $97.27 on March 31, 2016, and $114.74 on June 14, 2016. So as we can see in the image above, Cimarex’s stock price and short interest as a percentage of float are inversely correlated.

Short interest is an indicator that represents investor sentiment that a stock’s price is likely to fall. Increasingly short interest for a particular stock represents pessimism among investors.

Cimarex’s peers Concho Resources (CXO), Hess (HES), and Continental Resources (CLR) have a short interest ratios of ~5%, ~6%, and ~28%, respectively. All these companies make up ~9% of the iShares US Oil & Gas Exploration & Production ETF (IEO).

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Cimarex’s institutional holdings

Cimarex Energy’s floating shares are currently held by 706 institutional investors. The company’s institutional shares held as a percentage of float has remained the same since the end if 1Q16.

The number of new institutional buyers of XEC shares as of June 15, 2016, has also remained the same since March 31, 2016. XEC’s largest institutional holders include Vanguard Group, BlackRock, and Fidelity Investments, which own 9.13%, 6.86%, and 6.71%, respectively, of XEC’s outstanding shares.

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