Despite Big Lots' Fall, Short Positions Decrease

Discount retailer Big Lots (BIG) is the second most borrowed stock in the S&P500 today, with 29% of its shares outstanding on loan (%SOOL), topped only by Mylan (MYL) with 30% SOOL.

BIG's shares fell almost 13% on Friday. On November 7th, the company reported a 0.2% decline in third-quarter comparable store sales, falling at its lowest level in eight months. The company also stated that it now expects EPS near or slightly below the lower end of its prior guidance range of $o.15 to $0.19.

However, the three-year high in short interest came in November 2007, when the %SOOL peaked at almost 55%. Short positions were then closed out to increase again in April this year from 25% to 50%. Since then there has been more short covering, but 30% SOOL is still a significant figure. In much the same trend, Utilisation has decreased from 70% in early October to 43% now.

 

In the UK, Vedanta Resources (LSE:VED), up nearly 1% today, has decided to cut its capital expenditure plans by $1.5bn through various initiatives. Since early October, the %SOOL have increased, from 4.3% on October 18th to 6% in early November. Positions have now been covered, presumably on the back of these initiatives, to 5% SOOL. Interestingly, Utilisation has increased from 25% on October 18th to 43% now. Liberty International (LSE:LII) is the most borrowed stock in the FTSE 100, with 10.59% SOOL, a fall from 15% SOOL in June.

There has been a steady increase in short positions in Next (LSE:NXT) since July, when the %SOOL rose from 4% then to 10% now. This comes despite increased interest in the brand, potentially on the back of its catalogue purchase service. However, the company is down 2.34% today.