LyondellBasell’s Short Interest Continues to Decline

LyondellBasell’s short interest

The latest short interest report on August 15 indicates that LyondellBasell’s (LYB) short interest is at the lowest point since the beginning of 2018. According to the latest report, LyondellBasell’s short interest as a percentage of its outstanding shares stood at 1.63%. The company’s short interest fell from 2.9% at the beginning of 2018. However, the stock price has declined 5.9% since the beginning of 2018.

LyondellBasell’s Short Interest Continues to Decline

The declining trend in LyondellBasell’s short-interest indicates a decline in the negative sentiment towards the stock. The decline in the short interest could be attributed to the company’s better-than-expected quarterly earnings. The completion of the A. Schulman (SHLM) acquisition and the possible acquisition of a stake in Baskem reduced the negative sentiment towards the stock. LyondellBasell has started constructing the world’s largest PO/TBA plant, which is expected to be completed in 2021. As a result of all the positive developments, LyondellBasell’s short interest has fallen to the lowest level in 2018.

Peers’ short interest

LyondellBasell’s short interest is ~6.34 million shares, while its 90-day average trading volume is ~2.01 million shares. As a result, LyondellBasell’s short interest ratio is 3.15x, which indicates that it would take three days to cover all of the short positions in the stock. Below are peers’ short interest ratios:

  • Olin’s (OLN) short interest is ~4.85 million shares, while its average number of shares traded is 1.60 million. Olin’s short interest ratio is ~3.0x, which indicates that it would take three days to cover its short positions.
  • Celanese’s (CE) short interest ratio is 1.85x, which means that it would take two days to cover its short positions.

Investors could hold LyondellBasell indirectly by investing in the Invesco S&P 500 Equal Weight Materials ETF (RTM), which invests 4.2% of its portfolio in the stock as of August 28.