Facebook Inc.’s (FB) stock price declined by 19% on a slower growth outlook and weaker than expected 2nd quarter ad revenues. Short sellers, who had covered 12 million shares of their short positions since early April, had kept their Facebook short exposure stable over the past week ahead of earnings. The pause in short covering proved prescient as the today’s stock price decline earned short sellers $1.05 billion of mark-to-market profits.
Facebook shares shorted is 25.4 million shares, 1.07% of its float, and its short interest is $5.52 billion. Facebook is the 6th largest U.S. equity short behind Tesla Inc (TSLA) and its FAANG cohorts.
| Largest U.S. Equity Shorts
(in $ millions) |
Ticker | $ Short Interest | Monthly Change
In Short Interest |
| Tesla Inc | TSLA | $10,930 | -$429 |
| Apple Inc | AAPL | $8,389 | +$889 |
| Amazon.com Inc | AMZN | $7,913 | +$662 |
| Alphabet Inc A/C | GOOG/L | $6,708 | +$980 |
| Netflix Inc | NFLX | $6,456 | -$411 |
| Facebook Inc | FB | $5,516 | +$80 |
| Total FAANG | $34,982 | +2,199 |
Facebook’s 19% stock price decline gave Mark Zuckerberg a $17 billion mark-to-market loss, while Facebook short sellers are up over $1 billion in mark-to-market profits. Shorts have nearly wiped out their year-to-date losses and are down only $43 million in mark-to-market losses in 2018.
| FAANG Stocks
(in $ millions) |
Ticker | $ Short
Interest |
July Shares
Shorted |
7/26 Price
Change |
Day MTM
P/L |
YTD MTM
P/L |
YTD MTM
P/L % |
| Facebook Inc | FB | $5,516 | +28k | -18.96% | +$1,045.8 | -$42.7 | -0.88% |
| Amazon.com | AMZN | $7,813 | -29k | -2.98% | +$236.1 | -$3,362.8 | -44.82% |
| Apple Inc | AAPL | $8,389 | +4,983k | -0.31% | +$26.3 | -$1,234.6 | -14.17% |
| Netflix Inc | NFLX | $6,456 | +794k | +0.06% | -$3.9 | -$3,576.6 | -58.17% |
| Alphabet Inc A | GOOGL | $3,292 | +151k | +0.75% | -$24.7 | -$607.8 | -18.19% |
| Alphabet Inc C | GOOG | $3,416 | +115k | +0.37% | -$12.5 | -$656.8 | -19.04% |
| Total FAANG | $34,983 | +6,102k | +$1,267.1 | -$9,481.2 | -27.87% |
Want deeper insight into the above analysis?
Contact: Ihor.Dusaniwsky@S3Partners.net
Managing Director Predictive Analytics, S3 Partners, LLC
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