Hermes, Swatch and Coach: Share Price and Short Interest Down

From the look of the share prices of three stocks featured in Wednesday morning's Financial Times - Hermes (HESAF.PK), Swatch (SWGNF.PK), and Coach (COH) - it appears that now even the super-rich have started to curb spending, causing the value in these companies to decrease significantly, especially in the last three to four months.

Interestingly, and despite these falls in share prices, which have actually all bounced back over the past week, short investors have not increased their positions in these stocks as the price falls, meaning that these trades have been badly timed.

Short investors increased their positions in Hermes in May, when the percentage of the company's Market Cap out on loan (%MCOL) increased from 8% then to 11% in June. Since then the %MCOL has decreased to 8% in the last few weeks; just as the price dropped from 117EUR in early October to 99EUR today. This is in line with the stock bouncing back from 88EUR last week to 99EUR today, and investors have again increased their short positions as the price rises.

Swatch has almost halved in price since May; down from 300CHF then to 160CHF on Monday, and back to 174CHF on Wednesday. Short interest has decreased from 8% in June to 3% as of Monday, meaning again that this has been an ill-timed short.

In the U.S., Coach has also seen a decrease in its short position, despite the fact that the price has fallen - from 6% MCOL in June, to 1% now. The price has dropped from $35 in June to $19 on Wednesday.

Hermes

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Swatch

 

 

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Coach

 

 

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Disclosure: None

Comments

[123:]

Since when do the "super-rich" buy Coach? My understanding is that Coach bags are middle-market.

2008 Nov 09 10:55 AM