Apr 8, 2016

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Three Significant Healthcare Short Interest Moves To Analyze: Eli Lilly and Company (LLY), Abbott Laboratories (ABT), Biogen Inc. (BIIB)

Three Significant Healthcare Short Interest Moves To Analyze: Eli Lilly and Company (LLY), Abbott Laboratories (ABT), Biogen Inc. (BIIB)

Short Interest is the total number of shares of stock currently sold short in the market. Some technicians interpret high levels of short interest as bullish, some as bearish. The bullish perspective is that, because all short sales must be covered (i.e. short-sellers eventually must purchase shares to return the ones they have borrowed), short interest represents latent future demand for the stocks. As short sales are covered, the demand created by the share purchase will force prices up. The bearish interpretation of short interest is based on the fact that short-sellers tend to be larger, more sophisticated investors.

Accordingly, increased short interest reflects bearish sentiment by those investors in the know which would be a negative signal of the market’s prospects. Investors with brokerage accounts will often leave credit balances in those accounts when they plan to invest in the near future. Thus, credit balances may be viewed as measuring the potential for new stock purchases. As a result, a buildup of balances is viewed as a bullish indicator for the market.

As of 15/03/2016 short interest for Eli Lilly and Company (LLY) stood at 12337842 shares, a decrease of -436925 shares or -3.54 percent compared to 12774767 shares on 01/03/2016. This short interest comprises 1 percent of the entire float. Short interest ratio now stands at 2.55 at the average volume of 4843559 shares.

According to the latest short-interest data for the two-week period ended 15/03/2016 short interest for the stock of Abbott Laboratories (ABT) decreased from 17652306 shares at the end of the settlement date of 01/03/2016 to 17176901 shares, marking a decline of -475405 shares or -2.77 percent. The current short interest accounts for 1.17 percent of the company’s total outstanding common shares and the days-to-cover short interest ratio, on the other hand, is 2.111036 as of 15/03/2016 assuming average daily trading volume of 8136717 shares.

Short interest for the shares of Biogen Inc. (BIIB) rose 5.71 percent from 2715844 shares on 29/02/2016 to 2880214 shares on 15/03/2016. Investors have taken short positions on 1 percent of the total common shares of the stock that are floating on the exchange. The days-to-cover short interest ratio is now at 1.692995 days. It is based on average daily trading volume of 1701254 shares.

 

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