Short interest measured on a share basis is currently at an all-time high on SeaWorld Entertainment (SEAS US), since first listing its stock back in 2013. This is despite the company recently unveiling several new attractions to replace the “Shamu” show, which ended due to negative publicity and low attendance rates.
S3 Partners calculates the amount of money at risk on the short side is now up to $360.8 million, an increase of 23.5% since the beginning of the year, when shorts had $292 million of exposure. Shares on loan on a percentage basis are up even more since the start of 2017, from 15.4 million to 23.07 million, an increase of 49.50%. This would peg short interest as a percentage of float at 34.3% currently.
Year-to-date, bearish speculators have netted a paper gain of 20.1% on an average short position of $312.7 million. The majority of this gain (15.7%) has come within the past 90 days of trading, where shares borrowed has consistently trended higher (see Black App real-time short interest chart below). The stock price is down close to 14% over this 3-month time frame, with the stock price hitting a low of $15.64/shares yesterday.
The next few quarterly results should be very telling as to how much traffic is driven to SeaWorld theme parks on the back of the two new attractions, and whether bearish speculators continue to make an even bigger splash on their books.
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Director, S3 Partners
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