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 share on the ASX by some distance. The online travel agent has short interest of 15%, which is flat week on week. Although its outlook is improving, short sellers appear to believe its shares are severely overvalued.
- Western Areas Ltd (ASX: WSA) has seen its short interest reduce slightly to 11.4%. This nickel producer’s shares crashed lower recently after management downgraded its production guidance. However, they have bounced back now, much to the dismay of short sellers.
- Tassal Group Limited (ASX: TGR) has seen its short interest rise to 9.3%. Short sellers have been rapidly increasing their positions in this salmon producer. There are concerns that salmon could be another item that China slaps tariffs on.
- Myer Holdings Ltd (ASX: MYR) has seen its short interest jump sharply to 9.1%. Short sellers have been increasing their interest in this department store operator amid concerns it is being left behind due to changing consumer habits.
- Speedcast International Ltd (ASX: SDA) still has short interest of 9%. The communications satellite technology provider’s shares have been suspended for almost the entire year as it undertakes a recapitalisation.
- Flight Centre Travel Group Ltd (ASX: FLT) is back in the top ten with short interest of 8.9%. As with Webjet, things are looking better for the travel agent, but short sellers appear to believe the market is expecting too much.
- Metcash Limited (ASX: MTS) is also back in the top ten with 8.7% of its shares held short. Though, with the wholesale distributor’s shares hitting a 52-week high last week, they may be regretting this one.
- InvoCare Limited (ASX: IVC) has short interest of 8.5%, which is down slightly week on week. There are concerns that this funerals company has been losing market share, which could drag on its earnings.
- AVITA Therapeutics Inc (ASX: AVH) has 8.3% of its shares held short, which is up sharply week on week. The regenerative medicine company’s shares will be dumped out of the ASX 200 at the December quarterly rebalance. Its sales have fallen heavily this year because of COVID-19.
- Inghams Group Ltd (ASX: ING) has 8.2% of its shares held short, which is flat week on week. Although the poultry company’s performance has improved in FY 2021, some short sellers appear to believe it isn’t over the worst of its issues just yet.
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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 Avita Medical Limited. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. The Motley Fool Australia has recommended Avita Medical Limited, Flight Centre Travel Group 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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