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OFS Stocks with High Short Interest: Do You Own Any of Them?

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Nov. 20 2020, Updated 4:58 p.m. ET

OFS stocks with high short interests

Currently, Diamond Offshore Drilling’s short interest-to-equity float ratio is 30.5%. It’s the highest among the OFS (oilfield equipment and services) stocks that are part of the VanEck Vectors Oil Services ETF .

One month ago, Diamond Offshore Drilling’s ratio was 30.9%. Three months ago, it was 26.7%. In the last three months, Diamond Offshore Drilling stock rose 11.1%, while its short interest-to-equity float ratio rose 14.3%. The company’s net debt-to-EBITDA (earnings before interest, tax, depreciation, and amortization) ratio is 2.7x. Its cash and cash equivalents were $119.0 million in 3Q16.

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Carbo Ceramics

Carbo Ceramics’ (CRR) short interest-to-equity float ratio is 25.7%. One month ago, it was 24.9%. Three months ago, it was 34.9%. In the last three months, the stock fell 5.6%. Its short interest-to-equity float ratio fell 26.3%. Its cash and cash equivalents totaled $78.9 million in 3Q16. It’s one of the high implied volatility OFS stocks that we analyzed in Part 1 of this series.

Seadrill

Seadrill’s (SDRL) short interest-to-equity float ratio is 24.9%. One month ago, it was 24.0%. Three months ago, it was 20.6%. Its net debt-to-EBITDA ratio is 4.1x. Its cash and cash equivalents totaled $1.0 billion in 3Q16. The stock rose 32% in the last three months, while its short interest-to-equity float ratio rose 21%. It’s also one of the high implied volatility stocks that we looked at in Part 1 of this series.

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Tidewater

Tidewater’s (TDW) short interest-to-equity float ratio is 23.4%. One month ago, it was 24.4%. Three months ago, it was 37.3%. In the last three months, the stock rose 37%, while its short interest-to-equity float ratio fell 37.1%. Tidewater’s cash and cash equivalents totaled $678.4 million in 3Q16. Its net debt-to-EBITDA ratio was 13.1x.

It has the highest implied volatility among OFS stocks that are part of OIH.

Rowan Companies

Rowan Companies’ (RDC) short interest-to-equity float ratio is 20.1%. One month ago, it was 20.2%. Three months ago, it was 17.1%. The company’s net debt-to-EBITDA ratio is 1.5x. Its cash and cash equivalents totaled $484.2 million in 3Q16. In the last three months, Rowan Companies stock rose 35.5%, while its short interest-to-equity float ratio rose 17.6%.

The high short interest in stocks such as Tidewater, Carbo Ceramics, and Seadrill could explain why they also have high implied volatilities. Traders pile on short positions due to expectations of a large fall in stocks. Expectations of large movements in stocks can increase their implied volatilities. Stocks can move wildly as the bulls and bears slug it out.

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