Earlier today we sent out our updated look at short interest trends for the S&P 1500 as well as each sector and industry group. Below we wanted to provide a look at the stocks in the S&P 1500 with the highest short interest as a percentage of float. The list of stocks below shows every stock in the S&P 1500 that has more than 25% of its free floating shares sold short. As is usually the case most of the stocks listed are small caps. In fact, the only non small cap stocks on the list are JC Penney (NYSE:JCP), Cliffs Natural (NYSE:CLF), Gamestop (NYSE:GME), and KB Home (NYSE:KBH). Looking at sector representation, Consumer Discretionary dominates with a third (9) of the stocks on the listed coming from that sector, and is followed by Technology with five stocks. Behind those two sectors, no other sector has more than three stocks on the list.
In our recent updates on short interest, we have highlighted the fact that short-sellers just haven't been able to win whether the market was up or down. When the market was rallying, the most heavily shorted stocks rallied more, and when the market pulled back in late January, the most heavily shorted stocks held up better than the overall market. Based on the performance of the most heavily shorted stocks, February proved to be just as tough for the short-sellers. As shown in the table below, during the month of February (through 3 pm Friday) the most heavily shorted stocks in the S&P 1500 were up an average of 5.51%, which is 170 basis points better than the 3.81% return of the S&P 1500.