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) is still the most shorted share on the ASX and experienced a jump in short interest to 15%. Short sellers appear to believe the market is getting ahead of itself and that its shares are overvalued at the current level.
- Western Areas Ltd (ASX: WSA) has seen its short interest rebound to 11.6%. Short sellers have been going after the nickel producer after management downgraded its production guidance.
- Speedcast International Ltd (ASX: SDA) still has short interest of 9.3%. The communications satellite technology provider’s shares have been suspended for almost the entire year as it undertakes a recapitalisation.
- InvoCare Limited (ASX: IVC) has short interest of 8.6%, which is flat week on week. Tough trading conditions and potential market share losses have been weighing on its shares recently.
- Tassal Group Limited (ASX: TGR) has seen its short interest rise to 8.5%. Concerns over its uncertain near term outlook could be why short sellers are targeting the salmon producer.
- Inghams Group Ltd (ASX: ING) has 8.2% of its shares held short, which is down slightly week on week. An improvement in the poultry company’s performance in FY 2021 hasn’t scared of short sellers just yet. They appear concerned with potentially high input costs.
- A2 Milk Company Ltd (ASX: A2M) has jumped into the top ten with 8.2% of its shares held short. Short sellers appear to be betting that the infant formula company will fall short of its guidance this year due to weakness in the daigou channel.
- Myer Holdings Ltd (ASX: MYR) has seen its short interest fall to 7.4%. The department store operator has been struggling in the current operating environment and reported a massive loss in FY 2020.
- Galaxy Resources Limited (ASX: GXY) is back in the top ten with short interest of 7.3%. Short sellers may believe the lithium miner’s shares have climbed too far over the last few months and are now overvalued.
- AVITA Therapeutics Inc (ASX: AVH) has entered the top ten with 7.3% of its shares held short. The regenerative medicine company’s shares have come under pressure this year after COVID-19 had a negative impact on its sales in FY 2020.
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James Mickleboro owns shares of Galaxy Resources Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Avita Medical Limited. The Motley Fool Australia owns shares of and has recommended A2 Milk and Webjet Ltd. The Motley Fool Australia has recommended Avita Medical Limited and InvoCare Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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