An improving outlook for a company tends to shake out bearishness for companies facing high short-selling. In the technology sector, shares in companies like Oracle (ORCL) and Cisco (CSCO) rose more prominently than normal, after short-sellers covered their negative bets against them. Investors who bet against the prospects in Yahoo (YHOO) lost up to 25% as shares rose from $16 in October 2012 to $19.50. The companies experiencing a sharp decline in bearishness are listed below: Analyze These Ideas: Access a performance overview for all stocks in the list Bearishness happened to have declined for large capitalization technology stocks. While the negative positions could have been hedges, the appreciation in these shares is justified. Oracle reported another strong quarterly result, while Cisco did not provide guidance that was too disappointing. Yahoo’s management change is so-far being greeted positively. Social media companies like Facebook (FB) or LinkedIn (LNKD) may command a premium, but Yahoo still draws healthy traffic to its content-generating sites. Yahoo Finance continues to be a popular portal for investors, and its partnership with CNBC and other media houses ensures there is always fresh material for its users. Of the companies listed, only communications equipment maker QUALCOMM (QCOM) and Microsoft (MSFT) continued to decline after short-selling volume declined 10% and 14% respectively.
EXCLUSIVE OFFER: Jim Cramer’s Protégé, Dave Peltier, only buys Stocks Under $10 that he thinks could potentially double. See what he’s trading today with a 14-day FREE pass.Apple could indirectly impact the valuation for Qualcomm. Citi recently downgraded some of the Apple suppliers, but Qualcomm is well-positioned for the continued growth in smartphones. Demand may eventually reach saturation in North America, but so far there is no evidence that this is happening. Demand in China, Europe, and the developing nations will ensure upside for Qualcomm.
The outlook for Microsoft is neutral at best, at least in the short-term. After recently re-testing a low at around $26.55, investors will get a better idea on January 24 2013 on sales for Windows 8. Microsoft might also provide guidance on unit upgrades for the new operating system at that time. Investors should brace for disappointment.Interactive Chart: See changes in 1-year return over the past two years. Click through to access more free tools from Kapitall.
Written by KAPITALL’S Chris Lau .