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AMD Short Interest Hits New High

Bill Maurer profile picture
Bill Maurer


  • Nearly 182 million shares now short.
  • Stock falls below $10 per share.
  • Is this all cryptocurrency-related?

As the chart below shows, one of the market's biggest losers over the past six months is chip maker Advanced Micro Devices (NASDAQ:AMD). While the company has posted decent results, it appears that the Street isn't totally buying the recent business improvement. With some of this appearing to be due to the cryptocurrency burst, short interest recently hit a new high.

(Source: Seeking Alpha AMD quote page)

I mentioned back in January that short sellers were returning, sending the number of shares short back over 175 million. At that time, shares had recently jumped a few bucks, but we also had questions surrounding security flaws with Intel (INTC) chips. There was a bit of covering after earnings, but as you can see below, more bets are now being placed against the name than at any time period in the last roughly three years. In fact, short interest is up more than 63% in the past twelve months.

(Source: Nasdaq AMD short interest page; last data point on chart is for settlement date of 3/29/2018)

The turning point for short interest was the second half of 2016, primarily around the time AMD had a large equity/debt offering. It is possible that some of those shorting the stock are long the convertible bonds and thus this is a pair trade or hedge. However, the surge in short interest over the last year probably can't be explained by this, especially given AMD's continued turnaround and GAAP profits.

Yes, part of the reason AMD has not done well has to do with US markets falling a bit from their all-time highs on China trade war concerns. However, I do believe part of the problem is also the fall in cryptocurrencies, which was a key part of a recent negative analyst note that called for

This article was written by

Bill Maurer profile picture
I am a market enthusiast and part-time trader. I started writing for Seeking Alpha in 2011, and it has been a tremendous opportunity and learning experience. I have been interested in the markets since elementary school, and hope to pursue a career in the investment management industry. I have been active in the markets for several years, and am primarily focused on long/short equities. I hold a Bachelor of Science Degree from Lehigh University, where I double majored in Finance and Accounting, with a minor in History. My major track focused on Investments and Financial Analysis. While at Lehigh, I was the Head Portfolio Manager of the Investment Management Group, a student group that manages three portfolios, one long/short and two long only. I have had two internships, one a summer internship at a large bank, and another helping to manage the Lehigh University Endowment for nearly a year. Disclaimer: Bill reminds investors to always do their own due diligence on any investment, and to consult their own financial adviser or representative when necessary. Any material provided is intended as general information only, and should not be considered or relied upon as a formal investment recommendation.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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