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DowDuPont’s Short Interest before Its 4Q17 Earnings

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Jan. 26 2018, Updated 9:03 a.m. ET

DowDuPont’s short interest

The latest short interest data as of December 29, 2017, showed that DowDuPont’s (DWDP) short interest has risen negligibly since its 3Q17 earnings were announced on November 2, 2017. The data show that the bearish sentiment in the stock has fallen. As a result, the stock price could increase. As of December 29, 2017, DowDuPont’s short interest as a percentage of outstanding shares stood at 0.69%. The short interest increased from 0.65% as of November 7, 2017. For the same period, the stock price rose from $71.14 to $71.22.

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After posting a better-than-expected 3Q17 earnings, DowDuPont wanted to quickly work towards the cost-saving synergy of $3 billion and its $4 billion new share repurchase program. These two moves are expected to add value to the shareholders. The cost-saving synergy and new share repurchase program helped keep the positive sentiments going for DowDuPont. As a result, the short interest in DowDuPoint is very low compared to its peers.

Short interest ratio for DowDuPont and its peers

In terms of the number of shares, DowDuPont’s short interest was at ~16.10 million shares. DowDuPont’s average trading volume is ~7.65 million shares, which means a short interest ratio of ~2.10x. It requires two days to cover all of the short positions. Below are the short interest ratios for DowDupont’s peers.

  • Monsanto (MON) – the short interest was 4.59 million shares. The average number of shares traded is ~2.8 million shares. The short interest ratio is ~1.64x, which indicates that it will take two days to cover all of the short positions.
  • The Mosaic Company (MOS) – the short interest is at 15.20 million, while the average number of shares traded is at 4.95 million. It will take three days to cover all of the short positions.
  • Eastman Chemical (EMN) – the short interest ratio stands at ~4.30x. It will take four days to cover all of the short positions.

Investors can hold DowDuPont indirectly by investing in the iShares U.S. Basic Materials ETF (IYM). IYM has invested 24.60% of its portfolio in DowDuPont as of January 22, 2018.

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