At the start of each week I like to look at ASIC’s short position report to find out which shares are being targeted by short sellers.
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:
- Speedcast International Ltd (ASX: SDA) is now the most shorted share on the Australian share market with short interest of 13.2%. Short sellers have done very well with this one. The communications satellite technology provider is currently in the process of declaring itself bankrupt.
- Myer Holdings Ltd (ASX: MYR) has seen its short interest slide to 13%. Short sellers have been targeting the retailer amid concerns that the pandemic has accelerated the structural decline of department stores.
- Super Retail Group Ltd (ASX: SUL) has seen its short interest pull back to 9.6%. Short sellers may believe that some of this retailer’s brands are going to underperform in a tough retail market.
- Webjet Limited (ASX: WEB) has seen its short interest rise to 9.6%. I suspect that short sellers are targeting the online travel agent due to its current valuation. It is worth noting that although its shares have crashed lower this year, its market capitalisation is actually higher than it was in January.
- Inghams Group Ltd (ASX: ING) has 9.35% of its shares held short, which is up slightly week on week. Earlier this year management warned that a change in its sales mix could weigh on the poultry company’s performance in FY 2020.
- Perpetual Limited (ASX: PPT) has entered the top ten with short interest of 9.2%. This fund manager has been a poor performer in FY 2020, reporting a 14% decline in profit in the first half. This was driven by fund outflows and lower performance fees.
- Nearmap Ltd (ASX: NEA) has seen its short interest edge lower again to 8.9%. Short sellers continue to close their positions after the aerial imagery technology company impressed with its performance during the pandemic.
- Clinuvel Pharmaceuticals Limited (ASX: CUV) has seen its short interest fall to 8.8%. Short sellers may be regretting this one. Last week the biopharmaceutical company’s shares rocketed a massive 21% higher.
- Bank of Queensland Limited (ASX: BOQ) has entered the top ten with 8.4% of its shares held short. Investors appear to believe the regional bank is going to have a tough 12 months.
- JB Hi-Fi Limited (ASX: JBH) has seen its short interest fall to 8.1%. Short sellers have been closing their positions in a hurry after the retailer revealed explosive sales growth during the second half.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Nearmap Ltd. The Motley Fool Australia owns shares of and has recommended Super Retail Group Limited and Webjet Ltd. The Motley Fool Australia 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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