Twitter Stock Up 2% as Short Positions Decline
Twitter Stock Might Be Back on Track
Twitter Inc (NYSE:TWTR) stock had a rough 2016, declining almost 30% over the year and being the constant subject of rumors about potential buyouts and mergers. But the fortunes of the social media giant might be turning around, at least if you consider the short-selling positions.
Twitter stock has seen short sellers closing their bets so far in 2017, which may bode well both for the future performance of the shares, as well as demonstrate a lack of volatility in TWTR stock.
Short-seller interest in Twitter stock has dropped by about 20% this year so far, falling to $733.0 million. Short sellers who bought and sold in recent weeks incurred net losses of about $11.5 million, according to Ihor Dusaniwsky, managing director of research at financial analytics firm S3 Partners. Conversely, short traders made profits of $160.0 million on Twitter stock last year. (Source: “Why Short Sellers Are Giving Up on Twitter,” Fortune, January 30, 2017.)
Twitter saw 44 million of its shares short-sold in mid-January 2017, which is equivalent to about 6.2% of the company’s outstanding stock, according to NASDAQ. That’s down by about a third from 9.5% at the end of October 2016.
But all this is to say that 2017 has been a bright spot in an otherwise tough go for the company. Twitter stock is up nearly six percent since the beginning of the new year, making January a relatively bright spot for the company, especially compared to previous months. In December 2016, for instance, Twitter fell by nearly 12%.
Twitter has looked into ways to expand its business in order to help boost its share prices, but to little success so far. Some legacy issues persist, like the inability to edit tweets, and other quibbles that consumers have long bemoaned. Compared to other social media giants, like Facebook Inc (NASDAQ:FB), Twitter has experienced slow growth and a lack of innovation.
The company will report its quarterly results on February 9, which will either add to the good news of early 2017 or put a halt to TWTR stock’s recent gains.