No matter how high Tesla stock soars, short interest is still growing.
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Maybe we should start calling the Tesla bears Tesla bulldogs – they just won’t let go. The TSLA stock price has more than doubled since the company reported third-quarter earnings last October, and the shorts have lost whole closets full of shirts. However, it seems quite a few of them are still praying for a disaster – Tesla recently regained its title as the most-shorted US stock.
According to financial analytics firm S3 Partners (as reported by Bloomberg), last week the total short interest in Tesla reached $14.5 billion, edging out Apple, which had a short interest of $14.3 billion.
If the size of a company’s short interest is considered a badge of honor, then Apple’s is not very impressive in context – the iPhone maker has a market capitalization of $1.4 trillion, some 14 times that of Tesla.
Betting against Tesla “has been a phenomenally bad bet,” as NPR put it – the shorts shed a collective $2.89 billion in 2019, and have written off another $2.8 billion this January alone, according to S3 Partners. Since 2016, these financial freebooters are out a cool $11.1 billion. (Betting against Apple hasn’t been a sweet experience either – AAPL has soared by 19% since early December.)
Some of the bears are leaving the field – around 40% of the short interest has been closed out since the middle of 2019, inflicting “a tsunami of hurt” on the folks Elon Musk calls “jerks who want us to die.” But more than a few of these intrepid investors are still holding the line. Mark Spiegel is one – although he has reduced the size of his position, he’s still convinced that Musk’s house of cards will someday collapse. “Obviously we’ve been way too early on the timing,” Spiegel says. “But you never know that in advance.”
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Written by: Charles Morris
EDITOR’S NOTE: This article comes to us courtesy of EVANNEX, which makes and sells aftermarket Tesla accessories. The opinions expressed therein are not necessarily our own at InsideEVs, nor have we been paid by EVANNEX to publish these articles. We find the company’s perspective as an aftermarket supplier of Tesla accessories interesting and are happy to share its content free of charge. Enjoy!
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