Why Short Interest in CVX Has Fallen ahead of Earnings


Apr. 18 2018, Updated 9:01 a.m. ET

Short interest in CVX

Chevron (CVX) has seen a fall in its short interest (as a percentage of outstanding shares) by 0.2 percentage points at the end of March to the current level of 1.1%. This fall implies that bearish sentiment in the stock has decreased. Over the same period, Chevron stock has risen 6.4%.

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Why the rise in positive sentiments in CVX?

Since the end of March, Chevron has observed a rise in positive sentiment, likely due to a surge in oil prices. WTI has risen 4.2% since the end of March to $67 per barrel. Plus, the increase in the broader market could have further built up positive sentiment. The SPDR S&P 500 ETF (SPY), the broader market indicator, rose 2.3%.

Also, the fact that Wall Street analysts expect stellar performance from Chevron’s 1Q18 earnings could have further led to the rise in positive sentiment.

Peers’ short interest

Chevron’s peers Statoil (STO) and Petrobras (PBR) have also witnessed a fall in their short interest by 0.01 percentage points and 0.15 percentage points, respectively, since the end of March. Currently, STO and PBR’s short interest stands at 0.15% and 0.86%, respectively. Also, YPF (YPF) saw a 0.02-percentage-point drop in its short interest since the end of March. Short interest in YPF currently stands at 0.72%.

Since the end of March, STO, PBR, and YPF stock rose 10%, 4%, and 4%, respectively.

Pre-earnings series overview

In this series, we reviewed CVX’s EPS estimate and segmental earnings prospects for 1Q18. We also evaluated Chevron’s stock performance and moving averages. Then we calculated the stock price forecast range for CVX for the 15-day period up to April 27. This range was based on its current implied volatility. We also looked at analysts’ ratings for CVX ahead of Q1 earnings. We concluded the series with a review of short interest in CVX before earnings.


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