31 August 2017
Reporter: Drew Nicol

IHS Markit analyses the UK’s most shorted prepare to reveal earnings

Oil and gas service provider Petrofac is this week’s most shorted UK firm in the wake of accusations of bribery by the UK’s Serious Fraud Office, according to IHS Markit.

Currently, Petrofac has 10.6 percent of shares out on loan as short sellers looked to capitalise on the heavy losses that the revelations instigated.

IHS Markit analyst Simon Colvin said in a research note: “Petrofac short sellers were eager to take profit off the table immediately, and the demand to borrow its shares nearly halved in a few weeks.”

“This restraint proved to be temporary, and Petrofac’s short interest increased to the highest level in 18 months.”

The only European firm with more short interest this week was German midcap Bertrandt Group, which helps automobile and aviation firms with design solutions.

IHS Markit noted that sell side analysts recently revised their guidance on Bertrandt, citing a lack of demand from its top customers, and shares fell heavily as a result.

The latest data shows Bertrandt trading at a five-year low and indicates that short sellers haven’t given up the chase yet, with driving short interest to an all-time high.

Colvin added: “Short sellers, who have been targeting Bertrandt for much of the year, should feel vindicated for their tenacity.”

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