24 Jan

How ExxonMobil’s Short Interest Compares

WRITTEN BY Maitali Ramkumar

Short interest in XOM

ExxonMobil’s (XOM) short interest (as a percentage of outstanding shares) has fallen from 0.9% on October 2, 2017, to 0.8%, implying that bearishness in the stock has decreased. Over the same period, ExxonMobil stock has risen 6.8%.

How ExxonMobil’s Short Interest Compares

Why the fall in bearishness?

Oil prices significantly impact upstream business earnings, and WTI (West Texas Intermediate) prices have risen 25% since October 2, which we discussed earlier in this series. ExxonMobil’s fall in short interest could be attributed to oil prices rising, as well as its better-than-expected 3Q17 earnings. Recently announced tax reform, lowering the corporate tax rate to 21%, has also likely supported the stock—lower tax could increase the company’s net income and cash flow.

ExxonMobil’s short interest trends could change after it releases its 4Q17 results, as it is expected to report higher earnings year-over-year. We discussed this in the first part of this series.

Peers’ short interest

Since October 2, peers PetroChina (PTR), YPF (YPF), and Suncor Energy (SU) have also witnessed a fall in their short interest, by 0.07%, 0.2%, and 0.3%, respectively, to 0.3%, 0.52%, and 0.23%. Since October 2, PTR’s, YPF’s, and SU’s stock prices have risen 16.8%, 8.8%, and 6.8%, respectively.

Series overview

In this series, we reviewed XOM’s EPS estimates, segment-wise earnings prospects for 4Q17, stock performance, and moving averages. We forecast its 14-day stock price range based on its current implied volatility and reviewed analysts’ ratings for XOM. In this final part, we looked at its short interest.

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