Since everyone loves a winner, it's reasonable to assume that everyone hates a loser -- everyone but short sellers, at least. These contrarian investors bet that hot stocks are primed to fall, aiming to turn their pessimism into potential profits.

This week let's look at companies on the American Stock Exchange. Combining that with the collective intelligence of Motley Fool CAPS, we'll see which of these firms Fools believe have the power to continue to make short work of short sellers.


Shares Short, June 13

Shares Short, May 30

% Change


% of Float

CAPS Rating (out of 5)

Cheniere Energy (AMEX:LNG)







Telkonet (AMEX:TKO)







Pioneer Drilling (AMEX:PDC)







Golden Star Resources (AMEX:GSS)







Ladenburg Thalman (AMEX:LTS)







Sources: and Motley Fool CAPS. Share counts in millions.
*Shares outstanding, minus shares controlled by insiders, restricted stock and shares held by 5% owners.

Of course, this isn't a list of stocks to buy -- or short! These stocks could have serious problems that warrant their short interest, but they might also be stricken by short-term troubles. Only Foolish due diligence will tell you for certain; our 110,000-strong CAPS community just offers a good place to start. Yet investors seem to like most of these companies, as evidenced by most having three-star CAPS ratings or better.

A pioneering spirit
If the federal government decides to allow drilling and exploration in the 19-million-acre Arctic National Wildlife Refuge (ANWR) in the remote northeast corner of Alaska, many contend it will help ease the exploding cost of oil prices. Critics contend it will be many years into the future before the benefits of allowing such drilling are felt. In the interim, contract land drillers like Pioneer Drilling have been enjoying the demand for their services in the current situation, and they would likely benefit if ANWR drilling were allowed as well.

Although the debate over opening up new areas for drilling remains fascinating, investors like CAPS All-Star falcon2382 find it much more exciting to consider the takeover prospects of small players like Pioneer:

a smallcap company that provides contract land drilling. I expect these smaller players to become potential acquisition targets as larger companies require more resources. But even if they don't get scooped up by larger players, they will be contracted out more and more as the need for further equipment and manpower intensifies in this bull energy market.

A golden moment
Golden Star Resources -- which operates extensively in Ghana, West Africa -- has found that the elevated price level of gold has made it more attractive and economically feasible to extract it from sulfide rock. Golden Star says results from shallow transition ores are consistent with expectations; the company anticipates greater amounts of gold ore as it digs deeper. That's good news, since Golden Star has been a company in turmoil, replacing much of its top management and recording larger losses this past quarter than a year ago. Now it's also facing higher costs to tap into Ghana's power grid.

That hasn't deterred top All-Star CAPS investors like GS751, who feels Golden Star is a play on high gold prices.

A little oversold based on the news ... Either I am right or the news ... is wrong. Don't you love to bet on yourself. Gold and Oil have a heavy correlation. This stock effectively is a bet on gold prices. Latest 10Q "As mining progresses deeper in the sulfide pits we expect to mine less of the near-surface, low-recovery transition ores, and more of the fresh sulfide ore which metallurgical testing indicates will yield higher gold recoveries." The sell-off today, me being bullish on gold prices long term, indicates a green thumb for this one.

Speak up
You've heard from the CAPS community -- now it's your turn to have your say. Share your views with the CAPS community: Squeeze 'em till it hurts, or short 'em till the sun don't shine? May the best argument prevail!