WPP British Communications & Advertising Stock Down 64%: Short Interest Doubles

WPP is a British communications and advertising services company. This year, WPP is down 64%—the steepest decline in the FTSE 100—while the FTSE index is up 21%.

The company has lost high-profile clients, received multiple analyst downgrades, underwent management turnover, faces potential removal from the FTSE, has a 10% dividend yield that may be cut, and is grappling with a deteriorating business model.

Short interest has more than doubled over the past three months to 12.8% of float, coinciding with the stock’s sharp decline.

With the rising short interest, WPP’s crowded score has climbed to 65, up from 50 earlier. This indicates that any upward move in the stock could trigger a spike in its short squeeze score.

Following a 14% upward move, WPP’s short squeeze score has reached 75, a level considered significant in S3’s short interest analytics.

It is too early to tell whether a short squeeze will occur, which would likely be reflected in a decline in short interest if it does.

The long interest of active managers increased by 12%, and that of hedge funds doubled. This represents value-oriented buying on the way down, a reversal strategy.

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