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:
- Pilbara Minerals Ltd (ASX: PLS) continues its long run as the most shorted ASX share with 21.4% of its shares held short. This is down slightly week on week again but is still significantly higher than second place. Concerns over a lithium surplus appear to be behind this.
- IDP Education Ltd (ASX: IEL) has 12.8% of its shares held short, which is down materially week on week. Last week, this language testing and student placement company revealed that it is being negatively impacted by student visa changes in a number of key markets.
- Syrah Resources Ltd (ASX: SYR) has short interest of 10.7%, which is down week on week again. This graphite miner's shares have been targeted due to weak battery materials prices, production suspensions, and further cash burn.
- Liontown Resources Ltd (ASX: LTR) has 10% of its share held short, which is up slightly week on week. There are concerns that lithium prices will stay at low levels for years. This doesn't make it a good environment to commence production at Kathleen Valley in the middle of the year.
- Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest fall week on week to 9.6%. There are concerns over the travel agent giant's revenue margins and consumer travel spending.
- Westgold Resources Ltd (ASX: WGX) has short interest of 9.6%, which is now up for a fifth week in a row. This appears to have been driven by doubts over the gold miner's proposed merger with Canada-based Karoa Resources.
- Chalice Mining Ltd (ASX: CHN) has short interest of 9.5%, which is up week on week again. This mineral exploration company's Gonneville Project is a globally significant critical minerals project, but it is still a long way off production and even a final investment decision.
- Sayona Mining Ltd (ASX: SYA) has short interest of 9.4%, which is flat from last week. It is yet another lithium miner that is being targeted due to weak lithium prices.
- Australian Clinical Labs Ltd (ASX: ACL) has short interest of 8.5%, which is down meaningfully since last week. This health imaging company is guiding to another sharp decline in its earnings in FY 2024.
- Healius Ltd (ASX: HLS) has short interest of 8.4%, which is up week on week. It is another health imaging company that is battling tough trading conditions at present.
