Every Monday I like to look at ASIC’s short position report to find out which shares are being targeted by short sellers.
This is because I believe it is well 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:
- Webjet Limited (ASX: WEB) continues to be the most shorted ASX share with short interest of 14.7%. Recent spikes in COVID-19 cases in Europe and the United States have sparked concerns that global travel markets could take longer to recover than expected.
- Speedcast International Ltd (ASX: SDA) has short interest of 10.6%. This embattled communications satellite technology provider’s shares have been suspended for most of 2020 whilst it undertakes a recapitalisation. Last week Speedcast advised that it has filed its restructuring plan and expects to emerge in the first quarter of 2021.
- InvoCare Limited (ASX: IVC) has short interest of 9.9%, which is down slightly week on week. Short sellers have been targeting this funerals company due to the impact that social distancing restrictions are having on its performance.
- Myer Holdings Ltd (ASX: MYR) has seen its short interest fall again to 9.5%. Short sellers may believe that this department store operator will be left behind by the structural shift to online shopping.
- Mesoblast Limited (ASX: MSB) has seen its short interest rise to 8.9%. This biotech company’s short interest has risen strongly since the US FDA didn’t approve its remestemcel-L application for steroid-refractory acute graft versus host disease (SR-aGVHD). Short sellers may believe it will struggle to gain approval even after additional trials.
- Galaxy Resources Limited (ASX: GXY) has seen its short interest slide to 8.9%. This lithium miner’s shipments, grades, and recoveries have been lower than expected this year. Combined with weak prices, FY 2021 looks set to be a tough year.
- Inghams Group Ltd (ASX: ING) has 8.7% of its shares held short, which is up slightly week on week yet again. Short sellers have been targeting the poultry producer due to higher input costs and an unfavourable shift in its sales mix.
- Flight Centre Travel Group Ltd (ASX: FLT) is back in the top 10 with short interest of 7.7%. As with Webjet, there are concerns that delays in the recovery of the global travel market could weigh on Flight Centre’s performance for longer than hoped.
- Bank of Queensland Limited (ASX: BOQ) has seen its short interest fall to 7.55%. Unfortunately for short sellers, this regional bank’s shares stormed higher last week after it delivered a stronger than expected full year result.
- CLINUVEL Pharmaceuticals Limited (ASX: CUV) has seen its short interest remain flat at 7.5%. The biopharmaceutical company has seen its short interest ease notably in recent weeks after announcing plans to extend the use of its SCENESSE product.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group Limited and InvoCare Limited. 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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