Short interest in 3M
The latest data as of December 15, 2017, shows that 3M’s (MMM) short interest has risen, which signifies that the bearish sentiment in the stock has increased and the stock price could come down. As of November 30, 2017, MMM’s short interest as a percentage of outstanding shares stood at 1.0% and had risen to 1.2% as of December 15, 2017. During this period, the stock fell 2.1%.
Why short interest rose
MMM’s stock price reached an all-time high on November 30, 2017, with an RSI (or relative strength index) of 76, which indicates that the stock has moved into an overbought position temporarily. As a result, 3M stock witnessed selling pressure, resulting in the increase in short interest.
Short interest ratio of MMM and its peers
In terms of the number of shares, MMM’s short interest was at ~7.3 million shares. MMM’s average trading volume is approximately 1.9 million shares. Thus, MMM’s interest ratio is ~4.0x, which indicates that it requires four days to cover all the short positions in MMM. Below are the short interest ratios of MMM’s peers:
- Honeywell’s (HON) short interest is ~9.7 million, and the average number of shares traded is 2.7 million. Thus, the short interest ratio is approximately 4.0x, which indicates that it will take four days to cover the entire short position.
- General Electric’s (GE) short interest is at 120 million, while the average number of shares traded is at 78 million, indicating it requires two days to cover GE’s short position.
- Caterpillar’s (CAT) short interest ratio stands at ~4.0x, which means it requires four days to cover its short position.
Investors can indirectly invest in 3M by investing in the Vanguard Industrials ETF (VIS), which invests 4.6% of its portfolio in 3M as of January 3, 2018.