Thomas Cook in top shorted stocks after profit warning

THOMAS Cook made a surprise entry into the UK’s top ten most shorted stocks by the end of July after it issued its third profit warning in a year, according to Data Explorers.

The embattled holiday operator had more than ten per cent of its shares out on loan by 28 July after it warned on 12 July that it was likely to miss its full-year profit forecasts.

It joined others struggling to maintain sales as cash-strapped consumers cut back on discretionary spending.

“Average short interest across the FTSE All Share is only 1.74 per cent but consumer-facing groups such as second-tier retailers, travel and betting companies see far greater demand from short sellers and dominate the list of most shorted stocks,” said DataExplorers research director Will Duff Gordon.

Directory publisher Yell Group topped the list for another month with almost a fifth of its shares on loan as bearish investors saw it facing a long-term decline.

Short sellers also targeted smaller retailers such as electrical goods specialist Dixons and Argos owner Home Retail Group that have had their sales battered by falling consumer confidence and spending.

Analysis: The top ten most shorted stocks

Yell Group 19.8%

Dixons Retail 19.21%

Home Retail Group 17.25%

Provident Financial 15.42%

HMV 14.21%

Carpetright 12.61%

Lonrho 11.68%

Thomas Cook 10.8%

Betfair Group 10.48%

Next Plc 12.61%

Source: Data Explorers