For a look at the market’s sentiment on a stock, one idea is to look at shares shorted. Changes in shares shorted over time can be a clear indicator for where market sentiment is moving.
We ran a screen on a universe of clean energy stocks (i.e. companies that use or produce clean sources of energy) for those with significant decreases in shares shorted month-over-month, a bullish development.
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the 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 that these stocks have strong outlooks? Use this list as a starting point for your own analysis.
List sorted by decrease in shares shorted as a percent of share float.
1. ReneSola Ltd. (NYSE:SOL): Engages in the manufacture and sale of solar wafers and solar power products. Market cap of $163.28M. Shares shorted have decreased to 5.57M from 7.15M month-over-month, a decrease representing 2.61% of the company's 60.54M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 3.13). The stock has performed poorly over the last month, losing 14.55%.
2. Ashland Inc. (NYSE:ASH): Operates as a specialty chemicals company in the United States and internationally. Market cap of $4.43B. Shares shorted have decreased to 2.36M from 3.20M month-over-month, a decrease representing 1.16% of the company's 72.14M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.77). The stock has had a couple of great days, gaining 13.65% over the last week.
3. First Solar, Inc. (NASDAQ:FSLR): Manufactures and sells solar modules using a thin-film semiconductor technology. Market cap of $4.13B. Shares shorted have decreased to 21.83M from 22.43M month-over-month, a decrease representing 1.01% of the company's 59.57M share float. The stock is a short squeeze candidate, with a short float at 37.09% (equivalent to 5.49 days of average volume). The stock has had a couple of great days, gaining 7.16% 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.