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) remains the most shorted share on the ASX after its short interest lifted slightly to 13.3%. Short sellers are not giving up on this online travel agent despite a surge in its share price this month thanks to COVID-19 vaccine optimism.
- Western Areas Ltd (ASX: WSA) has seen its short interest slide to 11%. Short sellers have been targeting the nickel producer after a weak start to the financial year and lower than expected grades led to management downgrading its production guidance.
- Myer Holdings Ltd (ASX: MYR) has seen its short interest remain flat at 9.7%. Although there is currently takeover speculation surrounding this department store operator, it hasn’t scared off short sellers just yet. They appear to believe Myer will struggle in the current operating environment.
- Speedcast International Ltd (ASX: SDA) still has short interest of 9.4%. The communications satellite technology provider’s shares remain suspended while it undertakes a recapitalisation.
- InvoCare Limited (ASX: IVC) has short interest of 8.6%, which is down week on week yet again. A number of short sellers appear to have been closing positions after the funerals company announced acquisitions in the pet cremation industry.
- Inghams Group Ltd (ASX: ING) has 8.3% of its shares held short, which is flat week on week. Although the poultry company revealed an improvement in its performance in FY 2021, some short sellers aren’t giving up on this trade just yet.
- Mesoblast Limited (ASX: MSB) has seen its short interest remain flat at 8.3%. Unfortunately for short sellers, the Mesoblast share price continued to surge higher last week. Investors have been buying its shares after it announced a major deal with pharma giant Novartis that could be worth upwards of US$1.25 billion.
- Metcash Limited (ASX: MTS) has seen its short interest rise to 8.2%. Short sellers appear to believe the wholesale distributor isn’t performing as well as you might expect during the pandemic. We won’t have to wait long to find out, its half year results are due next week.
- Tassal Group Limited (ASX: TGR) has entered the top 10 with short interest of 8.1%. Short sellers don’t appear to believe management will deliver on its earnings growth guidance in FY 2021 due to COVID headwinds.
- Flight Centre Travel Group Ltd (ASX: FLT) has short interest of 8.1%. Short sellers have been closing positions amid an improving outlook in the travel sector due to the COVID vaccines.
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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.