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Why Short Interest in Plains All American Pipeline Rose 17%

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Jan. 31 2018, Updated 7:35 a.m. ET

Short interest in PAA

Short interest in Plains All American Pipeline (PAA) as a percentage of its float is 2.9%—higher than the 2.5% it recorded at the end of December 2017. According to data released on January 24, the total number of Plains All American shares shorted was ~12.4 million on January 12—17.3% higher than the ~10.6 million from December 29. Short interest in Plains All American is higher than its average of ~1.4% in the last five years.

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The above graph shows changes in short interest in Plains All American stock over the last year along with its stock price. The recent rise in short interest in Plains All American Pipeline might show that more investors think its price will fall soon compared to investors who expect a fall at the end of December 2017.

Short interest ratio

Short interest in Plains All American stock is ~12.4 million shares while its average 30-day daily trading volume is ~3.4 million shares. So Plains All American’s short interest ratio—short interest divided by average trading volume—is ~4x. This number means it will take approximately four days to cover all the open short positions in Plains All American stock.

Short interest in Enterprise Products Partners (EPD) was ~23.2 million shares on January 12—6% higher than its 21.9 million shares on December 29. Short interest in ONEOK (OKE) fell nearly 2.3% to ~9.6 million shares on January 12.

Next in this series, we’ll discuss how Plains All American stock performed in the last 12 months and what its moving averages indicate about its expected near-term performance.

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