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:
- Flight Centre Travel Group Ltd (ASX: FLT) continues its long run as the most shorted ASX share after its short interest remained flat at 11.8%. Short sellers appear to believe that revenue margin headwinds will weigh on its performance.
- Megaport Ltd (ASX: MP1) has seen its short interest ease a touch to 11.2%. Slowing growth and the shock departure of this network-as-a-service company's CEO and CFO have caught the eye of short sellers.
- Zip Co Ltd (ASX: ZIP) has short interest of 10.2%, which is flat week on week. This high level of interest may have been driven by regulatory concerns and doubts over its profit goals.
- Core Lithium Ltd (ASX: CXO) has short interest of 9.1%, which is down slightly week on week. A number of brokers believe this lithium miner's shares are overvalued compared to peers.
- Sayona Mining Ltd (ASX: SYA) has seen its short interest fall to 9%. Short sellers aren't giving up on this lithium miner despite the recent restart of its NAL project.
- Temple & Webster Group Ltd (ASX: TPW) has seen its short interest rise to 8.5%. Short sellers may believe that this online furniture retailer could be struggling with the housing market downturn, cost of living crisis, and shift back to offline shopping.
- Jervois Global Ltd (ASX: JRV) has entered the top ten with 8.2% of its shares held short. This cobalt developer's shares have been crushed this year after it suspended the final construction of the Idaho Cobalt Operations due to continuing low cobalt prices. Jervois has already spent US$130 million on its construction.
- JB Hi-Fi Limited (ASX: JBH) has short interest of 8.1%, which is up week on week. Short sellers appear to believe that this retail giant's sales could suffer because of the housing market downturn and cost of living crisis.
- AMA Group Ltd (ASX: AMA) is back in the top ten with 7.6% of its shares held short. This smash repair company's balance sheet is in a terrible state and could require a major recapitalisation.
- Pointsbet Holdings Ltd (ASX: PBH) has also returned to the top ten with 7.5% of its shares in the hands of short sellers. Intense competition and its ongoing cash burn appear to be behind this.
