Is Jim Chanos Shorting These 5 Stocks?

In this article, we ask is Jim Chanos shorting these 5 stocks. You can read our detailed analysis of Chanos’ hedge fund and its performance over the years or go directly to Is Jim Chanos Shorting These Stocks?

5. Sunnova Energy International Inc. (NYSE:NOVA)

Value of Put Option: $1.66 Million
Number of Hedge Fund Holders: 22

Sunnova Energy International Inc. (NYSE:NOVA) is a residential solar and energy storage service provider. The company offers various services, including maintenance, monitoring, repairs, replacements, and on-site power optimization. Chanos has been extremely skeptical about solar companies questioning their business model that entails spending millions of dollars on projects that only end up generating negative free cash flow.

Sunnova Energy International Inc. (NYSE:NOVA) caught the attention of legendary short investor Chanos in the second quarter as he initiated a short position worth $3.74 million. Nevertheless, the short seller trimmed his short bet to 158,600 shares valued at $1.67 million, accounting for 0.52% of the portfolio. Despite the skepticism about Sunnova Energy International Inc. (NYSE:NOVA)’s long-term prospects, the stock is up by about 70% yearly.

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4. DigitalBridge Group, Inc. (NYSE:DBRG)

Value of Put Option: $5.73 Million
Number of Hedge Fund Holders: 21

DigitalBridge Group, Inc. (NYSE:DBRG) is an infrastructure company that specializes in digital infrastructure assets. The company primarily invests in data centers, cell towers, fiber networks, and edge infrastructure. DigitalBridge Group, Inc. (NYSE:DBRG) is one of the short bets on Chano’s investment portfolio.

According to the legendary investor, DigitalBridge Group, Inc. (NYSE:DBRG) is one of the companies that could be hurt by tech behemoths, which account for two-thirds of data center demand moving towards building and running their data centers. 

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3. Vertiv Holdings Co (NYSE:VRT) 

Value of Put Option: $14.60 Million
Number of Hedge Fund Holders: 66

Vertiv Holdings Co (NYSE:VRT) is another company with exposure to the data center sector that Chanos believes could come under pressure amid a changing landscape. Vertiv Holdings Co (NYSE:VRT) designs, manufactures, and services critical digital infrastructure technologies and life cycle services for data centers, communication networks and industrial environments.

As tech giants buy large swaths of land and build vast complexes, Vertiv Holdings Co (NYSE:VRT) is one of the companies that could be affected.

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2. Equinix, Inc. (NASDAQ:EQIX)

Value of Put Option: $90.71 Million
Number of Hedge Fund Holders: 42

Equinix, Inc. (NASDAQ:EQIX) is another data center plays that legendary investor Chanos is shorting due to growing concerns about the company’s long-term prospects. Equinix, Inc. (NASDAQ:EQIX) provides communication services through data centers, colocation, connectivity, and professional services.

Chanos increased the value of his short position in Q3 2023 to 124,900 shares, accounting for 28.51% of the portfolio. The increase comes on the legendary investor insisting Equinix, Inc. (NASDAQ:EQIX) faces growing competition from tech giants led by Alphabet Inc. (NASDAQ:GOOG), Amazon.com, Inc. (NASDAQ:AMZN), and Microsoft Corporation (NASDAQ:MSFT) resorting to building their data centers instead of leasing. 

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1. Digital Realty Trust, Inc. (NYSE:DLR)

Value of Put Option: $180.77 Million
Number of Hedge Fund Holders: 27

Digital Realty Trust, Inc. (NYSE:DLR) is a real estate investment trust that owns, operates, and invests in carrier-neutral data centers. The company offers data center colocation and interconnection services. While the stock is up by about 36% for the year, it remains one of Chano’s biggest bear bets in the market. Chanos has termed Digital Realty Trust, Inc. (NYSE:DLR) a financially challenged company, citing a Morgan Stanley report that says its dividend is at risk.

Kynikos Associates started shorting the stock in Q4 2022. However, it trimmed its short position in Q3 2023 to 1.5 million shares from 2 million.

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