Everyone loves a winner. It's reasonable to assume, then, that everyone hates a loser. Yet with investing, that's not always the case.

Contrarian investors love to pick through stocks that others have cast away. Value investors are the garbage-divers of the marketplace. Conversely, when stocks have a big run-up, some investors like to bet against them. They're called short sellers, and they bet that a stock is primed for a fall.

What goes up must come down
Here's a list of stocks on the Nasdaq Stock Exchange that reported the biggest increase in their short positions in the most recently available period. We'll turn to the collective intelligence of the Motley Fool CAPS community to learn which of these stocks -- if any -- Foolish investors think have the power to make short work of short sellers.





CAPS Rating
(out of five)


94.5 million

78.2 million




24.1 million

11.6 million



Cisco Systems

54.8 million

42.5 million




29.7 million

18.9 million




18.8 million

8.4 million



Shares short data courtesy of Reuters. CAPS rating courtesy of Motley Fool CAPS.

Of course, this isn't a list of stocks to buy -- or short! Maybe these stocks have some serious problems that warrant the high short interest. Maybe not. What do you think? Will they be squeezed?

Tapping the CAPS advantage
Over on CAPS, more than 27,000 investors like you are looking over these same stocks. Some they like, some they don't, and they all vote on how they feel about them. Sometimes, though, the stocks CAPS players like cross swords with those the short sellers don't.

Fools think slightly more of this bunch than usual. Internet backbone Cisco, in particular, has received accolades. Perhaps short sellers are focusing on the decline in the meteoric growth of networking equipment to commercial clients. Instead of gilded double-digit growth rates, expectations are now in the low double figures. However, Cisco's announced acquisition of WebEx (NASDAQ:WEBX) may be enough to turn the game against the short sellers, since it will be bringing 20% revenue growth with it.

Nearly 15% of the more than 2,700 professional and novice investors weighing in on Cisco are considered All-Stars, CAPS players who consistently outperform their peers. They've been bullish on the provider of high-performance network and computer systems since November, as revealed by the company's CAPS trend. Here's what a few of those All-Stars had to say:

  • jtofabc summarized his views last August, and they could just as easily have been written with the recent WebEx acquisition in mind: "Massive cash advantage, using it to secure their field of endeavor through acquisitions of smaller geniuses."
  • Another top-rated CAPS All-Star, danbdex, agrees, noting its price is a "[g]ood value for the best company in the industry. Great growth prospects with (Internet Protocol Television) & broadband rollout. Global bandwidth usage will increase exponentially with IPTV usage."
  • ThatGuy73, who bests more than 90% of all other CAPS players, sees growth as inevitable: "I like the Scientific Atlanta acquisition and the prospects of the cable market along with the home networking gear which is a good growth market. Telco will always need their switches and routers with Cisco's end of life schedule on equipment, we are probably only starting into the replacement cycle for much of what was purchased in the boom period."

Speak up
You've heard from the CAPS All-Stars; now it's your time for a star turn. Tell the CAPS community what you have to say. On Motley Fool CAPS, your opinion counts just as much as the short sellers'. Tell us what you think: Squeeze 'em till it hurts, or short 'em till the sun don't shine. May the best argument prevail!

Microsoft is a recommendation of Motley Fool Inside Value, where a 30-day guest pass allows you to network with Philip Durell as he seeks out all of the market's hidden values.

Fool contributor Rich Duprey does not own any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.