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.
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:
- Tassal Group Limited (ASX: TGR) has seen its short interest rise week on week once again to 13.2%. The Australian seafood company's shares have come under pressure due to weak prices and concerns that it could be impacted by the Australia-China trade war.
- Webjet Limited (ASX: WEB) has seen its short interest remain firm at 12%. Although trading conditions are starting to improve, short sellers aren't giving up on this online travel agent just yet. They may have concerns over its valuation.
- Inghams Group Ltd (ASX: ING) has 9.2% of its shares held short, which is up slightly week on week again. Even though the poultry producer's shares recently hit a 52-week high, short sellers aren't giving up on it. During the first half of FY 2021, Inghams reported a 28.4% increase in underlying profit.
- Speedcast International Ltd (ASX: SDA) has short interest of 9%. This communications satellite technology provider's shares have been suspended for over a year while it undertakes a recapitalisation after its debts spiralled out of control.
- Mesoblast limited (ASX: MSB) has seen its short interest remain flat at 8.8%. Last week this biotech company's shares dropped lower after it raised US$110 million to keep its operations going.
- Resolute Mining Limited (ASX: RSG) has seen its short interest increase week on week to 8.4%. This gold miner's shares have come under a lot of pressure due to a weakening gold price and industrial disruption at its Syama operation. The latter has led to management forecasting further production declines and cost increases in FY 2021.
- AVITA Medical Inc (ASX: AVH) has seen its short interest rise week on week to 8.2%. The medical device company's sales have been growing but at a slower rate compared to the market's expectations. Short sellers don't appear confident that things will improve in the near term.
- Service Stream Limited (ASX: SSM) has short interest of 7.6%, which is up again week on week. The essential network services provider's shares have been sold off this year due to its underperformance in the first half and very weak outlook.
- Western Areas Ltd (ASX: WSA) is back in the top ten with short interest of 7.4%. Last month the nickel producer released a very disappointing half year result. It reported a 21.5% decline in revenue to $122.7 million and a 65.5% decline in EBITDA to $24 million.
- Metcash Limited (ASX: MTS) has seen its short interest rise to 7.3%. Short sellers may be concerned by reports that a price war is brewing in the supermarket industry.
