黑洞社区

Asset managers betting against a rise in Kier鈥檚 share price have ramped up their stakes as the market continues to predict a harder time ahead for the embattled contractor.

In the past week, five firms have increased their short positions on Kier, with a total of 8.4% of its stock being used to bet against it 鈥� despite the group鈥檚 share price already falling by 40% this month.

Companies take short positions by borrowing shares of a listed company and immediately selling them with the intention of buying them back for a cheaper price.

One firm, TT International, upped its short stake by 0.5% of Kier鈥檚 total number of shares on Tuesday 鈥� a day after the firm saw its stock fall to a new all-time of 108p.

And another, Blackstock, added to its short position on Monday as other traders were dumping Kier shares after chief executive Andrew Davies鈥� declared plans to sell four of Kier鈥檚 businesses and lay off 1,200 staff.

鈥淧eople aren鈥檛 playing games with short selling 鈥� firms do it to make money,鈥� said Tony Williams, analyst and chief executive of advice business 黑洞社区 Value.

鈥淓very time Andrew Davies opens his mouth [Kier鈥檚] shares seem to dive by 18% and the consensus in the market is that Kier will go bust. The market isn鈥檛 always right 鈥� but usually it is.鈥�

The other three firms to raise their short positions on Kier are GLG Partners, Marshall Wace and Kuvari Partners.

Kuvari Partners last year accused Kier of using 鈥渁ggressive鈥� accounting methods by using a percentage of completion method to book revenue 鈥� instead of recording actual cash flows.

Last September Kier was the most shorted firm listed on the London Stock Exchange, with more than 17% of its stock having been used to bet against the company.

Despite a small surge in its share price following its annual results announcement last September, Kier鈥檚 share price went on to drop almost 90% of its value between September and June.