3 Reasons Why You Shouldn't Bet Against Sirius XM Stock

Sirius XM Holdings (NASDAQ: SIRI) hit 11-year highs earlier this month -- fortified after posting another blowout quarter in late July -- but it doesn't mean the naysayers have gone away. There were a whopping 266.5 million shares of the satellite radio provider sold short at the end of July, its highest short interest on the investment since mid-March.

Short interest on Sirius XM has risen by 20% over the past year, but that's just one data point. The stock has soared 37% over the past year, so the value of all of the short positions on Sirius XM has actually skyrocketed 65% over the past 12 months. There are now more than $1.5 billion in bearish wagers against the stock in the form of short positions.

Sirius XM routinely tops the list of most shorted Nasdaq stocks by share count, so the bearishness isn't new. Some of those positions are hedges, but by and large it's a fair indicator of the pessimism among speculators when it comes to Sirius XM's near-term prospects. Shorting Sirius XM has been dangerous in the past, and that's not likely to change. Let's go over some of the reasons why Sirius XM eats bears for breakfast.

Source: Fool.com