The Stocks With Most Short Interest: Goldman Sachs Exposes Wall Street's Next Bearish Targets

The latest analysis from Goldman Sachs reveals an intriguing shift in how institutional investors are positioning themselves across U.S. markets. According to the investment bank’s comprehensive hedge fund holdings report, there’s a dramatic concentration of short interest across specific stocks with most short interest surging to levels not seen in years. This data snapshot, drawn from the holdings of 982 hedge funds commanding $4 trillion in total positions, shows that bearish bets are becoming increasingly selective and strategic as market sentiment grows more cautious.

Short Interest Hits Record Levels Across Markets

Recent data demonstrates that short interest among S&P 500 constituents has climbed to the 99th percentile over the past five years, with a median short interest ratio reaching 2.4% of total market capitalization. This marks a significant departure from historical norms since 1995, signaling that the current environment features more aggressive short-selling activity than typical market cycles. The Nasdaq 100, with its heavy concentration of technology stocks, shows an even higher ratio at 2.5%, reflecting particular skepticism around high-flying growth names.

Perhaps most strikingly, small-cap stocks have become the epicenter of short interest activity, with Russell 2000 constituents showing a median short interest ratio of 5.5%. This elevation represents substantial bearish conviction among institutional traders who believe smaller companies face greater vulnerability in the current market environment.

The Utilities Sector Emerges as the Surprising Short-Selling Hotspot

An unexpected development has unfolded within the utilities sector, where short interest has surged by 0.3 percentage points to reach 3.2%—approaching one of the highest levels ever recorded for this traditionally defensive industry. The driving force behind this phenomenon directly connects to the artificial intelligence wave sweeping through technology and infrastructure investment.

Data centers powering AI models demand enormous quantities of electricity, transforming previously “boring” utility stocks into prime takeover and profit-growth candidates. American Electric Power exemplifies this transformation, with shares appreciating more than 31% in the recent period and commanding a market capitalization of $65 billion. The company’s decision to elevate its five-year capital expenditure plan from $54 billion to $72 billion underscores commitment to supplying power infrastructure for major tech platforms including Alphabet, Amazon, and Meta. Despite these fundamentals, the stock carries a short interest ratio of approximately 4%, nearly double its historical 1-2% range over the preceding decade.

Which Stocks Face the Most Severe Short Pressure?

While utilities explain part of the short interest narrative, broader analysis reveals that established mega-cap technology remains the true focus of institutional bearish positioning. Tesla tops the list of most heavily shorted companies, with JPMorgan making a notable entry in fourth place. The leading stocks with most short interest include:

• Tesla
• Palantir
• Palo Alto Networks
• JPMorgan
• Robinhood Markets
• Costco
• Bank of America
• IBM
• Oracle
• Lam Research

In terms of absolute short positions, Oracle carries $5.4 billion in outstanding short interest, while Intel faces $4.6 billion and GE Vernova—a manufacturer of gas turbines for AI data center operations—carries $3.4 billion. These represent substantial short positions on an absolute basis, though they remain modest when measured against the massive market capitalizations of these corporations.

When analysts adjust for company size, a different picture emerges. Among publicly traded companies with market capitalizations exceeding $25 billion, Bloom Energy represents the most heavily shorted stock relative to its enterprise value. Other notable names appearing on this adjusted list include Strategy, CoreWeave, Coinbase, Live Nation, Robinhood, and Apollo—companies that collectively face the highest short interest pressure proportional to their scale.

What This Reveals About Hedge Fund Strategy

The evidence from Goldman Sachs’ holdings data unveils a sophisticated two-tier approach among institutional investors. Notably, “smart money” remains hesitant to aggressively short the dominant AI narrative players—Amazon, Microsoft, Meta, Nvidia, and Alphabet continue occupying the top five most commonly held long positions among U.S. hedge funds.

Instead, sophisticated investors are deploying short interest strategically against what could be characterized as “AI-adjacent weakness”—companies that have benefited from AI hype but may face sustainability questions, or those operating in AI infrastructure segments that appear overextended. This dynamic suggests fund managers recognize that bubbles frequently outlast individual investor timelines and patience, making direct shorts on category leaders economically hazardous.

The divergence between increasing short interest in utilities and weakness in selective technology plays, combined with sustained bullish conviction around mega-cap platforms, points toward a more nuanced market understanding. Rather than wholesale bearishness, sophisticated investors are making surgical bets against specific vulnerabilities while protecting exposure to the genuine long-term beneficiaries of technological transformation.

This tactical positioning—simultaneously holding long positions in category-defining platforms while building short interest against peripheral players—may represent the market’s mature acknowledgment that not all AI-era opportunities deserve equal valuation multiples, even as the underlying transformation narrative remains compelling.