Semiconductor manufacturer Nvidia Corp (NVDA US) is the second largest short in the Semiconductor & Semiconductor Equipment Sector behind Intel Corp (INTC US) but shorts have trimmed $748 million, or 20%, of their short exposure in 2017. It is also the worst performing short in the sector, down $1.4 billion, or -44.6%, in mark to market losses even with today’s $127 million gain due to 4.2% price drop.
| Semiconductor Sector
In $ millions |
Ticker | Short
Interest |
1 Month
Change in S.I. |
YTD MTM
P/L |
YTD MTM
P/L % |
|
| Intel Corp | INTC US | $4,000.0 | +$614.6 | -$8.4 | -0.3% | |
| Nvidia Corp | NVDA US | $3,050.8 | +$569.0 | -$1,405.8 | -44.6% | |
| Microchip Tech Inc | MCHP US | $2,103.0 | +$154.9 | -$399.1 | -23.5% | |
| Advanced Micro Devices | AMD US | $1,896.0 | -$171.7 | -$244.1 | -15.21% | |
| Xilinx Inc | XLNX US | $1,609.6 | +$91.0 | +$11.5 | +1.1% | |
| Micron Technology | MU US | $1,536.3 | -$285.9 | -$311.3 | -23.3% | |
| Lam Research Corp | LRCX US | $1,416.8 | +$51.9 | -$597.8 | -39.4% | |
| Qualcomm Inc | QCOM US | $1,186.5 | -$213.3 | +$226.3 | +21.9% | |
| Skyworks Solutions | SWKS US | $852.0 | +$166.8 | -$334.0 | -40.9% | |
| Broadcom Ltd | AVGO US | $823.5 | +$36.5 | -$266.9 | -41.6% | |
Short interest in the worldwide Semiconductor & Semiconductor Equipment Sector is $37.5 billion and has increased by $603 million over the last 30 days. Only two semiconductor shorts in the top ten have had positive returns this year, Xilinx (XLNX US) and Qualcomm (QCOM US) are up $12 million and $226 million respectively.
Shorts have been more active in NVDA recently. After hitting a year to date high of $4.5 billion in late May short interest had retreated to $2.4 billion by early July. There has been a steady increase of short selling over the last month with short interest now at $3.05 billion ahead of earnings.
Shorts have held steady and we see no significant short covering ahead of today’s announcement. Shorts have recouped most of August’s mark to market losses in today’s trading. A disappointing earnings report would help them chip away at the ten figure loss they have incurred in the first seven months of 2017. Semiconductor stocks have outperformed the broader market in 20017, NVDA shorts are hoping for a pullback if the overall market takes a late summer breather.
Want deeper insight into the above analysis?
Contact: Ihor.Dusaniwsky@S3Partners.net
Managing Director Predictive Analytics, S3 Partners
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