RELX Shorts Retreat as Call Buyers Run the Same Playbook

RELX enters Thursday's results as one of the least-shorted names in European-listed information services, a contrast worth spelling out before the print.

Among its closest structural peers, short positioning against RELX is conspicuously light. Wolters Kluwer and MSCI carry materially heavier bearish conviction in the lending market. RELX's own short interest has fallen nearly 36% over the past week to roughly 4.1 million shares, extending a monthlong retreat that has taken it down almost 39% from October's opening level. The ORTEX short score stands at 29.3, the lowest reading in the past ten sessions, down from 36.8 on October 20. That drop reflects both the reduction in borrowed shares and the broader easing in lending conditions.

The lending market reinforces that picture. Availability has surged to 1,828%, meaning there are now more than eighteen shares available to borrow for every one already lent out. That compares with roughly 554% when the previous earnings preview was published on October 27, and with a 52-week low of 19%. Cost to borrow has halved over the week to 0.34%, the lowest level in the 30-day history, leaving no mechanical pressure on shorts to cover. The borrow market is as relaxed as it has been all year.

Options traders are not using this window to hedge. The put/call ratio closed Monday at 0.21, barely changed from the 0.20 reading that preceded the October 23 release and still well below the 20-day mean of 0.41. That is nearly one standard deviation below average on the call-heavy side, and it has held in this band for two straight weeks. The prior October print rewarded that positioning: RELX rose 5.1% on the day and added 11.8% over the following five sessions. The stock has since climbed another 21% over the past month to $40.46, with a modest 0.9% gain on Monday finishing a steady week.

Citigroup pulled back its positive view on October 20, downgrading RELX to Neutral from Buy two weeks before this print. No other bellwether analyst action appears in the recent window. The consensus data on file is stale and should not be read as a current view, but the Citigroup move alone introduces a note of caution at the margin, particularly after a 20%-plus monthly run that has compressed the earnings yield to roughly 4.2% and pushed the PE multiple to just under 24 times. Bulls point to consistent revenue growth, with Q3 delivering 8% year-over-year gains and margin expansion of 120 basis points, and to the company's track record of raising full-year guidance. The bear case centres on valuation: at these multiples, any softening in legal, risk or compliance demand leaves little room for error.

Thursday's print will test whether the legal and risk analytics divisions can sustain the growth rates that have carried the stock to these levels, and whether the margin trajectory justifies a premium that now sits well above the sector.