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) remains the most shorted share on the ASX with short interest of 11.8%. This was down slightly week on week. Significant inventory issues and a slowdown in sales have been weighing heavily on this ecommerce company's shares.
- Resolute Mining Limited (ASX: RSG) has seen its short interest remain flat at 10.4%. Short sellers have been targeting this gold miner due to a number of operational issues and the weakening gold price. It was also just kicked out of the ASX 200 index.
- Webjet Limited (ASX: WEB) has seen its short interest edge lower to 10.4%. This online travel agent's shares continue to be a favourite of short sellers. They may believe it is overvalued, particularly given the stuttering travel market recovery.
- Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest remain flat at 9.4%. As with Webjet, recent lockdowns and border closures are threatening to push back this travel agent's recovery.
- Electro Optic Systems Hldg Ltd (ASX: EOS) has 8.7% of its shares held short, which is down week on week. Short sellers may be targeting this communications, defence, and space company due to concerns that supply chain issues could impact its performance.
- Inghams Group Ltd (ASX: ING) has 8.7% of its shares held short, which is up sharply week on week. Short sellers may have concerns over risks associated with an upcoming major contract renewal with a supermarket giant. Unfortunately, the poultry producer's shares hit a 52-week high on Friday, much to the dismay of short sellers.
- Tassal Group Limited (ASX: TGR) has short interest of 8.5%, which is flat week on week. Weak salmon prices have been weighing on the company's performance. However, Goldman Sachs believes that Tassal is set for a stronger FY 2022 with a recovery in demand well underway.
- Temple & Webster Group Ltd (ASX: TPW) has seen its short interest ease to 8.4%. Short sellers were targeting the online furniture and homewares retailer due to its plans to sacrifice profit growth to increase its market share.
- Zip Co Ltd (ASX: Z1P) has short interest of 7.1%, which is down week on week. Fears that a US bank will enter the BNPL market and undercut its Quadpay business appear to be weighing on sentiment.
- Megaport Ltd (ASX: MP1) has short interest of 7.1%, which is down week on week once again. Short sellers may be closing positions after investors began to switch from value stocks back into growth again.
