Why Do Investors Hate These Companies?

It's pretty easy to tell when investors don't like a stock. They sell. And when investors really don't like a stock they sell its shares short.

A recent Business Insider article listed the 30 most heavily shorted companies by stock market traders. One theme stood out in the piece: investors really hate solar stocks these days. SolarCity , SunPower , and SunEdison all appeared on the list, each with more than 25% of shares sold short.

Source: SunEdison Investor Presentation

The addressable solar market is expected to grow about 13% annually through the end of the decade. Furthermore, it represents a $1 trillion in cumulative capital. That's a lot of money, especially when considering that even after its run over the past two years, SunEdison's stock value is just over $5 billion. That suggests the future of the company's stock could be brighter than investors think, as just a tiny sliver of those sales would move the needle.

Investor takeaway

Investors see the surging stock valuations of solar stocks and worry they'll be burned. That's why a quarter or more of the shares of these solar stocks are being sold short. I'd counter that these investors might be short-sighted, because the future of solar looks brighter than ever.

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The article Why Do Investors Hate These Companies? originally appeared on

Matt DiLallo owns shares of SolarCity. The Motley Fool recommends SolarCity. The Motley Fool owns shares of SolarCity. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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