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Why Short Interest in HollyFrontier Has Fallen

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Jun. 18 2019, Updated 2:59 p.m. ET

Short interest in HollyFrontier

Since April 1, short interest in HollyFrontier (HFC) has fallen from 5.0% to 3.7%, while its stock value has fallen 18.2%. A decrease in short interest suggests a reduction in bearish sentiment toward a stock.

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Why the change in sentiment?

HollyFrontier’s decrease in short interest could be due to the company’s better-than-expected first-quarter revenue and earnings and strengthening cracks. HollyFrontier’s first-quarter adjusted EPS of $0.54 were weak, though they beat analysts’ estimate of $0.43. It had revenue of $3.9 billion.

This quarter, HollyFrontier’s refining index values have risen in the Midcon, Rockies, and Southwest regions by 16%, 13%, and 9% year-over-year, respectively, suggesting cracks are strengthening. Better cracks can offset narrower oil spreads.

Peers’ short interest

Since April 1, Delek US Holdings’ (DK), Valero Energy’s (VLO), and Phillips 66’s (PSX) short interest has fallen by 0.5, 0.5, and 0.2 percentage points, respectively, to 6.5%, 1.3%, and 1.3%. Their stock value has fallen by 2.8%, 9.5%, and 10.1%, respectively.

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