6/09/2013

20 Highly Shorted Financial Dividend Stocks And Which 11 Are Wrong

Financial dividend stocks with highest float short ratio originally published at "long-term-investments.blogspot.com". Financials are in focus of many investors because they have a great possibility to leverage profits and they benefit if the economy starts to grow. 

But the whole sector is also very vulnerable for systematic risks. Due to the concatenation of many firms, a bail in of one company can hurt the whole system deeply.

This is also one of the reasons why financial stocks are very popular targets for short sellers. If there develops a rumor, it ends in a bank run.

Today I like to show you which stocks from the financial sector (excluded by ETFs) have the highest float short ratio. My only restriction is a market capitalization of more than USD 300 million.

The 20 top results have a float short ratio between 11.56 and 28.67 percent. The Insuring industry is the biggest industry followed by REITs. Despite the negative view of the investors, eleven of the results have a current buy or better recommendation.

Here are the three most shorted financial dividend stocks:
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Amtrust Financial Services (NASDAQ:AFSI) has a market capitalization of $2.23 billion. The company employs 2,100 people, generates revenue of $1.865 billion and has a net income of $175.56 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $658.04 million. The EBITDA margin is 35.28 percent (the operating margin is 12.73 percent and the net profit margin 9.41 percent).


Financial Analysis: The total debt represents 6.34 percent of the company’s assets and the total debt in relation to the equity amounts to 41.08 percent. Due to the financial situation, a return on equity of 17.42 percent was realized. Twelve trailing months earnings per share reached a value of $3.09. Last fiscal year, the company paid $0.39 in the form of dividends to shareholders. AFSI has a float short ratio of 28.67 percent.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 10.71, the P/S ratio is 1.20 and the P/B ratio is finally 1.94. The dividend yield amounts to 1.69 percent and the beta ratio has a value of 0.86.

Long-Term Stock Price Chart Of Amtrust Financial Services (AFSI)
Long-Term Dividend Payment History of Amtrust Financial Services (AFSI)
Long-Term Dividend Yield History of Amtrust Financial Services (AFSI)

Radian Group (NYSE:RDN) has a market capitalization of $2.19 billion. The company employs 696 people, generates revenue of $825.41 million and has a net income of $-451.47 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $-258.09 million. The EBITDA margin is -31.27 percent (the operating margin is -53.81 percent and the net profit margin -54.70 percent).

Financial Analysis: The total debt represents 13.08 percent of the company’s assets and the total debt in relation to the equity amounts to 104.90 percent. Due to the financial situation, a return on equity of -47.06 percent was realized. Twelve trailing months earnings per share reached a value of $-3.43. Last fiscal year, the company paid $0.01 in the form of dividends to shareholders. RDN has a float short ratio of 26.45 percent.

Market Valuation: Here are the price ratios of the company: The P/E ratio is not calculable, the P/S ratio is 2.65 and the P/B ratio is finally 2.30. The dividend yield amounts to 0.08 percent and the beta ratio has a value of 2.74.

Long-Term Stock Price Chart Of Radian Group (RDN)
Long-Term Dividend Payment History of Radian Group (RDN)
Long-Term Dividend Yield History of Radian Group (RDN)

American Equity Investment Life Holding (NYSE:AEL) has a market capitalization of $1.05 billion. The company employs 399 people, generates revenue of $1.588 billion and has a net income of $57.80 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $311.25 million. The EBITDA margin is 19.59 percent (the operating margin is 5.41 percent and the net profit margin 3.64 percent).

Financial Analysis: The total debt represents 1.58 percent of the company’s assets and the total debt in relation to the equity amounts to 32.31 percent. Due to the financial situation, a return on equity of 3.69 percent was realized. Twelve trailing months earnings per share reached a value of $1.10. Last fiscal year, the company paid $0.15 in the form of dividends to shareholders. AEL has a float short ratio of 22.24 percent.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 14.89, the P/S ratio is 0.66 and the P/B ratio is finally 0.59. The dividend yield amounts to 0.91 percent and the beta ratio has a value of 1.78.

Long-Term Stock Price Chart Of American Equity Investment Life Holding (AEL)
Long-Term Dividend Payment History of American Equity Investment Life Holding (AEL)
Long-Term Dividend Yield History of American Equity Investment Life Holding (AEL)

Take a closer look at the full list of the most shorted financial dividend stocks. The average P/E ratio amounts to 18.88 and forward P/E ratio is 16.64. The dividend yield has a value of 3.13 percent. Price to book ratio is 2.22 and price to sales ratio 6.78. The operating margin amounts to 22.78 percent and the beta ratio is 1.21. Stocks from the list have an average debt to equity ratio of 0.81.

Here is the full table with some fundamentals (TTM):

Most Shorted Financial Dividend Stocks (Click to enlarge)


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Related stock ticker symbols:
AFSI, RDN, AEL, HCI, DLR, RHP, FFIN, FII, DFT, FNGN, CSH, NRF, SBY, UBSI, SBSI, PACW, CHCO, BSAC, RBCAA, VLY

Selected Articles:

*I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I receive no compensation to write about any specific stock, sector or theme.


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