At the start of each week I like to look at ASIC’s short position report in order to find out which shares are being targeted by short sellers.
This is because I believe it is worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn’t quite right with a company.
With that in mind, here are the 10 most shorted shares on the ASX this week according to ASIC:
- Galaxy Resources Limited (ASX: GXY) continues to be the most shorted share on the ASX despite its short interest falling slightly to 19.5%. An oversupply of lithium has weighed heavily on prices of the battery making ingredient and ultimately its shares.
- Syrah Resources Ltd (ASX: SYR) has seen its short interest slide to 17.3%. An oversupply of graphite has weighed heavily on this miner’s shares. Syrah is the owner of the massive Balama graphite operation in Africa.
- Orocobre Limited (ASX: ORE) has seen its short interest edge higher to 14.1%. Orocobre is another lithium miner which has come under pressure due to falling prices of the battery making ingredient due to an oversupply.
- Speedcast International Ltd (ASX: SDA) has short interest of 13.2%, which is flat week on week. The communications satellite technology provider’s shares have been suspended since the start of February. It appears to be struggling to arrange financing given the tough market conditions and its significant debt.
- Metcash Limited (ASX: MTS) has short interest of 13.1%, which is up week on week once again. Short sellers may be regretting this one. Metcash’s shares were surging higher last week after a broker upgrade.
- Inghams Group Ltd (ASX: ING) has short interest of 12.25%, which is down week on week once again. It appears as though some short sellers believe the poultry company’s shares have bottomed after its recent share price weakness.
- GWA Group Ltd (ASX: GWA) has short interest of 10.9%, which is up slightly week on week. The building products company’s shares have come under pressure recently following the release of a disappointing half year result. That update revealed a 69% decline in total net profit after tax to $23.6 million.
- Nearmap Ltd (ASX: NEA) has seen its short interest slide to 10.6%. The aerial imagery technology and location data company’s shares have fallen materially this year due to a surprise guidance downgrade following the loss of several key customers.
- New Century Resources Ltd (ASX: NCZ) has seen its short interest drop slightly to 10.1%. The base metal producer’s shares have collapsed over the last 12 months. Despite this, short sellers appear to believe it is not over the worst of its issues.
- Pilbara Minerals Ltd (ASX: PLS) has entered the top ten with short interest of 9.7%. Pilbara Minerals is yet another lithium miner that short sellers have successfully been targeting. Its shares are down 76% over the last 12 months.
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Motley Fool contributor James Mickleboro owns shares of Galaxy Resources Limited. The Motley Fool Australia owns shares of and has recommended Nearmap Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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