Something big is happening with the London Stock Exchange Group (LSEG)—and short sellers are taking notice. Over the past few weeks, the number of investors betting against the company has dropped dramatically.
As of mid-February, short interest in LSEG’s American Depositary Receipts (ADRs) fell by a stunning 88.3%, plummeting from 260,000 shares in late January to just 30,300 shares. That’s an enormous shift, signaling that fewer investors are willing to bet on LSEG’s stock losing value.
Strong Earnings Fuel Optimism
What’s changed? The latest results from the firm are very, very good. Pre-tax profits were up 10. 3% to £2. 97bn, from £2. 69bn last year.
LSEG’s data and analytics push has helped boost revenues, and its capital markets and post-trade services businesses are doing well, providing a strong platform for earnings growth going forward.
LSEG also announced a £500 million share buyback program, a move that usually signals confidence from management and helps boost shares.
LSEG’s Transformation Into a Global Financial Powerhouse
LSEG has diversified well beyond its traditional role as a stock exchange operator under CEO David Schwimmer, its financial data arm Refinitiv helping it compete with industry giant Bloomberg.
That means LSEG is no longer just reliant on exchange fees. It’s now a major player in the data and financial services industry, providing insights to investors all over the world. It’s been a game-changer, helping LSEG’s stock soar 27% over the past year.
Investors Show Confidence as Stock Rises
LSEG shows its strength, the market responds The company’s shares rose 2. 7% to £113. 95 in the wake of the earnings report and share buyback announcement.
Short sellers – profiting from stock declines – seem to be stepping back as confidence in LSEG increases. Adaptability, expansion and strong financial performance position it strongly for the future.
