We recently published a list of 12 Most Shorted Stocks in 2025. In this article, we are going to take a look at where Riot Platforms, Inc. (NASDAQ:RIOT) stands against other shorted stocks in 2025.
Reuters reported that President Trump’s tariffs have impacted the broader stock markets, weighing on investors’ sentiments, as worries related to the economic slowdown drove a market sell-off which wiped out ~$4 trillion from the S&P 500’s peak last month, when the markets cheered Trump’s agenda. New Trump policies have resulted in increased uncertainty for businesses, consumers, and investors.
Average Short Interest Saw a Decline
Reuters, while highlighting the comments made by Peter Orszag (CEO of Lazard), mentioned that the uncertainty which is created by tariff wars regarding Canada, Mexico and Europe continues to prompt the top executives to reconsider the forward-looking strategies. Furthermore, while the tensions with China remain understandable, investors are confused with worries related to Canada, Mexico, and Europe. If this doesn’t get resolved over the next month or so, there can be real damage to the broader economic prospects of the US and M&A activity, says Orszag.
As per S&P Global’s long/short report (February 2025) dated February 14, the average short interest throughout US equities fell to 76 basis points over the month. However, short interest increased throughout several sectors during the period. That being said, Consumer Durables saw a 5-bps rise and REITs encountered a 4-bps increase. Notably, the largest decreases were seen throughout the Household and Personal Products sector (-7 bps), and the Consumer Services (-6 bps) sectors.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
Trends in US Short Selling
The US markets have reversed their January rally with a weak February, says Ihor Dusaniwsky (Managing Director of Predictive Analytics). On February 28, Dusaniwsky stated that markets are down for the year, with the Nasdaq index seeing the brunt of the sell-off. The US short sellers were down $45.8 billion (3.42%) in January mark-to-market losses. Notably, two-thirds of every dollar shorted in January remained unprofitable and only 33% were profitable. With markets trending downward, there has been an increase in short selling throughout most of the sectors in the US/Canadian markets, says Dusaniwsky. If the weakness in the market continues, there can be increased short selling.
Our Methodology
To list the 12 Most Shorted Stocks in 2025, we used a screener and shortlisted the most shorted stocks. Next, we mentioned the hedge fund sentiment around each stock. Finally, the stocks are arranged in ascending order of their hedge fund holdings, as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A computer engineer working in a futuristic office, programming algorithms to mine cryptocurrency.
Riot Platforms, Inc. (NASDAQ:RIOT)
Number of Hedge Fund Holders: 38
Short % of Shares Outstanding (as of February 28): ~22.4%
Riot Platforms, Inc. (NASDAQ:RIOT) is a Bitcoin mining company in the US. Gregory Lewis, an analyst from BTIG, maintained a “Buy” rating on the company’s stock and the associated price target was $22.00. The analyst’s rating is backed by a combination of factors highlighting the company’s promising financial outlook. Moving forward, the expected increases in Bitcoin prices and strategic growth initiatives, such as expansion at Corsicana and integration of a newly-acquired engineering business, are expected to aid its revenues. Such measures can enhance Riot Platforms, Inc. (NASDAQ:RIOT)’s operational efficiency and capacity, resulting in strong financial performance.
Notably, 2024 saw major growth initiatives, which include the energization of its Corsicana Facility, and the acquisitions of Block Mining and E4A Solutions, which is a leading electrical engineering services company complementing its Engineering business and Bitcoin mining operations. Riot Platforms, Inc. (NASDAQ:RIOT)’s exploration of AI/HPC opportunities at its Corsicana site demonstrates a potentially transformative move, which can create new revenue streams and diversify Riot Platforms, Inc. (NASDAQ:RIOT)’s business model over and above the Bitcoin mining. The shift can attract a new class of investors and partners, mainly as demand for AI and high-performance computing infrastructure has been increasing. The growth initiatives, together with its significantly improved operating performance, led to the mining of 4,828 Bitcoins during FY 2024, at an average direct cost of $32,216 per coin.
Overall, RIOT ranks 2nd on our list of most shorted stocks in 2025. While we acknowledge the potential of RIOT as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued AI stock that is more promising than RIOT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
