This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

5 Heavily Shorted Stocks That Hedge Funds Love

Another problem for Ackman with his HLF short position is that other large hedge fund managers are joining Icahn and George Soros and going long the stock. On Tuesday, news came out that hedge fund manager Richard Perry, founder of Perry Capital, has taken a stake in Herbalife that is less than 5%. According to reports, Perry Capital believes the stock is cheap and the company is not a pyramid scheme.

From a technical perspective, shares of HLF have been trending sideways for the last month, after coming out of a bullish uptrend. That sideways trend has been pushing shares of HLF between close to $60 a share on the downside and $68 a share on the upside. Traders should be on alert for a squeeze off any high-volume move above some near-term overhead resistance levels at $67.69 to its 52-week high at $68 a share and then above its three-year highs at $70.30 a share. Look for volume on that move that hits near or above its three-month average action of 3.28 million shares. If that move triggers, then HLF could easily trade to $100 a share, or possibly even north of $100 a share.

Chesapeake Energy

Another heavily-shorted stock that Icahn has boosted his stake in is Chesapeake Energy ( CHK), a natural gas and oil exploration and production company. This stock has been on fire so far in 2013, with shares up smartly by 51%.

Chesapeake Energy has a market cap of $16 billion and an enterprise value of $29 billion. This stock trades at a cheap valuation, with a forward price-to-earnings of 11.93. Its estimated growth rate for this year 163.9%, and for next year it's pegged at 30.4%. This company currently sports a dividend yield of 1.4%. The current short interest as a percentage of the float for Chesapeake Energy is pretty high at 11.1%.

Icahn just announced that he's increased his stake in CHK to 9.98% from 8.98%, or a total of 66.5 million shares. This isn't Icahn's first buy of CHK, since he started buying the stock last year after the company ran into management and liquidity issues.
3 of 8

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
CHK $5.26 0.00%
HLF $57.98 0.00%
JCP $8.21 0.00%
NILE $37.30 0.00%
SLCA $20.23 0.00%


Chart of I:DJI
DOW 17,798.49 -14.90 -0.08%
S&P 500 2,090.11 +1.24 0.06%
NASDAQ 5,127.5250 +11.3820 0.22%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs