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Changes in shares shorted can be a helpful indicator for the sentiment surrounding a stock. When a stock sees fewer shares shorted over time, it is an indication that short sellers are less bearish on the company.

We ran a screen on stocks trading under $5 for those seeing significant decreases in shares shorted month-over-month.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬


We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.



Do you agree with short sellers on these names? Use this list as a starting-off point for your own analysis.

List sorted by decrease in shares shorted as a percent of share float.

1. Eastman Kodak Co. (EK): Provides imaging technology products and services to the photographic and graphic communications markets worldwide. Market cap of $634.96M. Price currently at $2.36. Shares shorted have decreased from 81.41M to 68.71M month-over-month, a change representing 4.74% of the company's 268.02M share float. It's been a rough couple of days for the stock, losing 16.9% over the last week.

2. Quantum Fuel Systems Technologies Worldwide Inc. (NASDAQ:QTWW): Develops and produces propulsion systems, and renewable energy generation systems and services in the United States and internationally. Market cap of $402.23M. Price currently at $2.14. Shares shorted have decreased from 2.02M to 1.61M month-over-month, a change representing 3.22% of the company's 12.74M share float. It's been a rough couple of days for the stock, losing 24.11% over the last week.

3. Advanced Semiconductor Engineering Inc. (NYSE:ASX): Provides semiconductor packaging and testing services for semiconductor companies. Market cap of $6.09B. Price currently at $4.51. Shares shorted have decreased from 26.65M to 4.92M month-over-month, a change representing 3.06% of the company's 709.35M share float. It's been a rough couple of days for the stock, losing 6.43% over the last week.

4. Standard Pacific Corp. (NYSE:SPF):
Operates as a diversified builder of single-family attached and detached homes in the United States. Market cap of $455.47M. Price currently at $2.30. Shares shorted have decreased from 21.77M to 19.67M month-over-month, a change representing 2.0% of the company's 105.24M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.3). The stock is a short squeeze candidate, with a short float at 10.1% (equivalent to 8.35 days of average volume). It's been a rough couple of days for the stock, losing 8% over the last week.

5. North American Palladium Ltd. (NYSEMKT:PAL): Engages in the exploration and production of palladium and gold properties primarily in Canada. Market cap of $440.67M. Price currently at $2.71. Shares shorted have decreased from 11.55M to 8.95M month-over-month, a change representing 1.82% of the company's 142.51M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.05). It's been a rough couple of days for the stock, losing 21.9% over the last week.

6. Sify Technologies Limited (NASDAQ:SIFY): Provides enterprise and consumer Internet services primarily in India. Market cap of $811.49M. Price currently at $4.55. Shares shorted have decreased from 4.80M to 4.42M month-over-month, a change representing 1.58% of the company's 24.04M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 3.27). It's been a rough couple of days for the stock, losing 6.95% over the last week.

7. China Real Estate Information Corporation (NASDAQ:CRIC): Provides real estate information and consulting services, online services, and real estate advertising services in the People's Republic of China. Market cap of $681.78M. Price currently at $4.70. Shares shorted have decreased from 1.72M to 1.52M month-over-month, a change representing 1.51% of the company's 13.23M share float. It's been a rough couple of days for the stock, losing 6.56% over the last week.

*Short data sourced from Yahoo! Finance, all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 7 Stocks Under $5 With Bullish Short Trends