Most shorted S&P 500 utility stocks at May end

Bets against utility stocks were higher in May than in April this year. Average short interest across S&P 500 utility stocks rose by 28 basis points to 2% of shares floating at the end of May.

The Utilities Select Sector SPDR Fund ETF (NYSEARCA:XLU) is up 10.1% compared to the broader S&P 500 (SP500), which climbed 13.5% from the start of the year.

Industry Analysis:

Average short interest as a percentage of floating shares

Short interest for Independent Power, which only includes AES Corp. (AES), currently stands at 2.48%, compared to 2.03% at April end. The subsector saw the biggest bps jump compared to the other segments within the utility belt.

Water utilities were the least shorted within the sector, with 1.80% short interest as of May end, up from 1.53% at April end.

Short interest for gas utilities is currently at 2.34%, a 20-bps drop from 2.54% at the end of April.

Stocks with the largest and least short positions

Ranked by short interest as a percentage of shares floating

NRG Energy (NRG) was the most shorted utility stock, with 11.23 million shares sold short as of May end, or 5.51% of the shares float.

Evergy (EVRG) was the second most shorted stock at 4.05% of shares floating, followed by NiSource (NI) and Pinnacle West (PNW) with short interest of 3.40% and 3.24%, respectively.

Entergy (ETR) is the least shorted stock, with 2.34 million shares sold short, or 1.10% of the shares floating, followed by Ameren (AEE) and PG&E (PCG) at 1.15% and 1.21%, respectively.

Heavyweights Duke Energy (DUK) and NextEra Energy (NEE) had short interest of 1.38% and 2.28%, respectively, at the end of May.