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:
- Webjet Limited (ASX: WEB) remains the most shorted ASX share with short interest of 11%, which is down slightly week on week. Concerns over the spread of the Delta strain of COVID-19 and the impact this will have on travel markets continues to weigh on Webjet’s shares.
- Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest rise to 10.1%. As with Webjet, short sellers are going after this travel agent due to longer than expected delays in the travel market recovery because of the Delta strain.
- Zip Co Ltd (ASX: Z1P) has seen its short interest fall again week on week to 9.4%. Short sellers have been closing positions following recent M&A activity in the BNPL industry. Zip has been touted as a potential takeover target of large rival Klarna.
- Kogan.com Ltd (ASX: KGN) has short interest of 8.8%, which is up week on week. Short sellers aren’t giving up on this one despite the fact that lockdowns are tipped to boost this ecommerce company’s performance.
- Electro Optic Systems Hldg Ltd (ASX: EOS) has 8.6% of its shares held short, which is up again week on week. Short sellers continue to target this communications, defence, and space company amid concerns over it cash flows and some major orders.
- Inghams Group Ltd (ASX: ING) has 8.5% of its shares held short, which is up slightly week on week. This appears to have been driven by concerns over a major contract renewal with a supermarket giant.
- Tassal Group Limited (ASX: TGR) has short interest of 8.1%, which is up week on week. Short sellers may be going after the seafood company due to weak salmon prices.
- PolyNovo Ltd (ASX: PNV) has seen its short interest remain flat at 7.1%. This medical device company has been under pressure since its soft finish to FY 2021.
- A2 Milk Company Ltd (ASX: A2M) has seen its short interest reduce to 6.6%. Investors have concerns over the company’s outlook given the sustained weakness in the daigou channel and the rise of Chinese infant formula brands.
- InvoCare Limited (ASX: IVC) has seen its short interest rise to 6.6%. This funerals company is believed to be losing market share despite investing heavily in acquisitions and its strategy. Short sellers don’t appear confident things will improve in the near term.