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What Delta Air Lines’ Short Interest Suggests

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Short interest

The latest short interest data as of January 31, 2018, showed that Delta Air Lines’ (DAL) short interest has fallen since its 4Q17 earnings were announced on January 11, 2018. The data show that the bearish sentiment in the stock has fallen. As a result, the price of the stock could increase. As of January 31, 2018, DAL’s short interest as a percentage of outstanding shares was 2.1%. Its short interest fell from 2.4% on January 12, 2018. For the same period, the stock fell from $59.83 to $56.77.

The decline in short interest was primarily due to better-than-expected earnings. DAL made an upward revision to its fiscal 2018 earnings guidance to $6.35–$6.70 per share, driven by tax reforms.

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Short interest ratio for Delta Air Lines and its peers

In terms of the number of shares, Delta Air Lines’ short interest was at ~14.8 million shares. Its average trading volume is ~8.6 million shares, which means a short interest ratio of ~1.7x. It requires two days to cover all its short positions. Below are the short interest ratios for Delta Air Lines’ peers.

  • American Air Lines (AAL) – Its short interest is 21.1 million shares. The average number of shares traded is 4.9 million. The short interest ratio is ~4.29x, which indicates that it will take four days to cover all of the short positions.
  • Southwest Airlines (LUV) – Its short interest is 11.5 million shares, while the average number of shares traded is 5.1 million. It will take two days to cover all of the short positions.
  • JetBlue Airways (JBLU) – Its short interest ratio is ~3.1x. It will take three days to cover all of the short positions.
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