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Has Short Interest in Delek Risen?

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Short interest in Delek

So far in this series, we’ve reviewed Delek US Holdings’ (DK) stock performance and moving averages in the current quarter. We’ve also forecast Delek’s stock price range leading up to December 31 based on its current implied volatility. In the previous article, we looked at Delek’s dividend yield trend. In this article, we’ll analyze changes in the company’s short interest.

Short interest as a percentage of outstanding shares in Delek has risen from 5.0% on July 2 to its current level of 6.5%. A rise in short interest usually implies that the bearish sentiment in a stock has risen. In the same period, Delek stock has fallen 7.4%.

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Why the change in sentiments?

Short interest in Delek has risen despite the company witnessing a recovery in its financials. The company posted better-than-expected earnings and captured higher-than-expected synergies from its Alon USA integration in the second quarter. It also benefited from widening oil spreads in the industry, which boosted its stock until August’s end.

However, since August’s end, the company’s top officials have reduced their holdings in its stock, which has likely created a bearish sentiment for the stock.

Peers’ short interests

PBF Energy’s (PBF), HollyFrontier’s (HFC), and Valero Energy’s (VLO) short interests have fallen 0.9%, 1.2%, and 0.4%, respectively, to their current levels of 4.5%, 4.6%, and 2.0%, respectively.

If we review these companies’ stock prices in the same period, PBF, HFC, and VLO have risen 24.9%, 0.8%, and 5.7%, respectively.

In the next and final article, we’ll look at Delek’s valuations.

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