SolarCity Corp (SCTY) Short Interest Surges With Other Solar Stocks

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SolarCity Corp (NASDAQ:SCTY) short interest jumped significantly this month, leading the way as short interest in other solar stocks also surged. According to Benzinga, short First Solar, Inc. (NASDAQ:FSLR), Real Goods Solar, Inc. (NASDAQ:RSOL) and a number of international solar stocks remain popular short positions as well.

SolarCity shorts surge nearly 25%

Short interest in SolarCity Corp (NASDAQ:SCTY) climbed about 25% this month, with more than 8 million shares being shorted. In the previous reporting period, short interest in the company had declined, but it rose so much this time around that it reclaimed most of that decline. The number of SolarCity shares being shorted was over 24% of the total float.

For some, it may seem obvious why investors are shorting SolarCity Corp (NASDAQ:SCTY), at least for now. The company’s market capitalization is around $6 billion, but it doesn’t offer a dividend, and its operating margins and return on equity are negative. Nonetheless, analysts tend to like SolarCity, with six of the 11 polled rating it as at least a Buy. However, SolarCity has surpassed the average analyst price target.

First Solar short interest grows nearly 18%

First Solar, Inc. (NASDAQ:FSLR), another well-known solar stock, saw its short interest rise more than 18% to nearly 12 million shares. That’s the highest level since last June, and short interest now represents over 16% of the float. It will take more than two days of trading to get all those shorts covered.

Goldman Sachs downgraded First Solar, Inc. (NASDAQ:FSLR) earlier this month, and shares have fallen since then. The company’s market cap is about $5 billion, and it doesn’t offer a dividend at this point. It trades at a price to earnings ratio that is less than the industry average and the forward earnings multiple. Most analysts polled by Thomson / First Call have a Hold rating on First Solar, probably because the company’s stock price is higher than the average analyst price target.

Other solar stocks also being shorted

SolarCity Corp (NASDAQ:SCTY) and First Solar, Inc. (NASDAQ:FSLR) aren’t the only stocks being shorted right now. More than 29% of Real Goods Solar, Inc. (NASDAQ:RSOL)’s float is being shorted now, which amounts to more than 7 million shares. However, the three analysts surveyed on this company all recommend buying it.

According to Benzinga, a number of ADR-listed foreign solar stocks saw double-digit increases in short interest recently. Canadian Solar Inc. (ADR) (NASDAQ:CSIQ), China Sunergy Co Ltd (NASDAQ:CSUN), JinkoSolar Holding Co., Ltd. (NYSE:JKS) and ReneSola Ltd. (ADR) (NYSE:SOL) all saw increased short interest recently.

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