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:
- Kogan.com Ltd (ASX: KGN) has become the most shorted share on the Australian share market after its short interest rose to 11.6%. This ecommerce company’s shares have come under significant pressure due to inventory issues and a slowdown in sales. Short sellers don’t appear to believe the worst is over.
- Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest rise slightly to 10.4%. Concerns over a stuttering recovery by the travel market have been weighing on investor sentiment. Particularly given the current Victorian lockdown.
- Resolute Mining Limited (ASX: RSG) has seen its short interest rise week on week again to 10.3%. Regulatory issues at its Bibiani operation in Ghana, a disappointing production performance, and underwhelming guidance are all impacting its shares.
- Webjet Limited (ASX: WEB) has seen its short interest jump to 10.2%. The Victorian lockdown, valuation concerns, and travel agent commission reduction fears may be behind this recent increase.
- Tassal Group Limited (ASX: TGR) has short interest of 9.6%, which is flat week on week once again. Tassal’s shares have come under pressure largely due to weakness in salmon prices.
- Temple & Webster Group Ltd (ASX: TPW) has seen its short interest ease to 9.4%. This online furniture and homewares retailer was targeted by short sellers due its plans to invest heavily in its future growth at the expense of margins.
- Electro Optic Systems Hldg Ltd (ASX: EOS) has 8.3% of its shares held short. This is flat week on week. This could potentially be due to concerns that the communications, defence, and space company’s performance will be impacted by supply chain issues.
- Megaport Ltd (ASX: MP1) has short interest of 8.3%, which is up again week on week. Although the Network as a Service provider continues to grow strongly, some short sellers appear to believe its shares are overvalued.
- Inghams Group Ltd (ASX: ING) has 8% of its shares held short, which is flat week on week. Unfortunately for short sellers, last week the poultry producer provided earnings guidance well ahead of the market’s expectations.
- Zip Co Ltd (ASX: Z1P) is back in the top ten with short interest of 7.8%. Last week analysts at UBS retained their sell rating and cut their price target to $5.60. The broker made the move amid concerns over margin pressures from increasing competition.