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Crowded shorts: Which one is a ‘buy’?

In a tough year for short-sellers, it might be time to move away from a few stocks, Yahoo Finance Senior Columnist Mike Santoli said Friday.

"It seems to me that the shorts have kind of made the money they're going to make in U.S. Steel right now," he said, noting that a lot of the successful short positions that have worked earlier in the year were in the basic materials space, due in part to the slowdown in China.

On CNBC's "Fast Money," Santoli said that U.S. Steel remains a heavily shorted stock, noting that it was down 18 percent year to date.

But, he added, the stock was "one of the best-performing big stocks in the fourth quarter the last 10 years."

(Read more: Market oomph? Not so much, bear says)

Meanwhile, Lumber Liquidators may have exhausted its downward trajectory.

"It's a very expensive building material stock. It's cheap flooring. Everyone knows the story about home improvement," Santoli said. "They' have a very aggressive sort of expansion plan. Short-sellers have talked about poor quality, insider selling, still very expensive, something like 30-something times next year's expected earnings.

"So, I don't think the risk/reward looks good in this one."

Shares of Lumber Liquidators fell further on news that federal authorities executed a search warrant at the companies Virginia headquarters.

(Read more: Lumber Liquidators shares plunge after feds search headquarters)

However, the most heavily shorted stock in the S&P 500J.C. Penney — presented a binary situation, Santoli said.

"I don't have a fundamental view," he said. "I really don't know how to play it right here. I just don't like the logic that says, 'Well, the stock's down 50 percent year to date. How much further can it go down?' Well, we always know how much further it can go down."

(Read more: Is JCP in a 'death spiral'?)

By CNBC's Bruno J. Navarro. Follow him on Twitter @Bruno_J_Navarro.

— CNBC's Michael Newberg contributed research to this report. Follow him on Twitter: @MikeNewberg.

Trader disclosure: On Sept. 27, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Pete Najarian is long AAPL; Pete Najarian is long calls C; Pete Najarian is long calls WFC; Pete Najarian is long calls INTC; Pete Najarian is long calls YHOO; Pete Najarian is long FB; Pete Najarian is long SBUX; Pete Najarian is long calls UAL; Simon Baker is long AAPL ; Simon Baker is long C; Simon Baker is long WFC; Simon Baker is long FB; Simon Baker is long GOOG; Simon Baker is long AMZN; Simon Baker is long NKE; Simon Baker is long HD; Simon Baker is long UAL; Stephanie Link is long AAPL; Stephanie Link is long JPM; Stephanie Link is long WFC; Stephanie Link is long CSCO; Stephanie Link is long FB; Stephanie Link is long LOW; Stephanie Link is long EXY; Stephanie Link is long YUM; As of 9/25 Josh Brown is long AAPL; Josh Brown is long DXJ; Josh Brown is long DDD; Josh Brown is long SSYS; Josh Brown is long VGK.

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