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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) remains the most shorted ASX share with flat short interest of 21.3%. With analysts forecasting lithium prices to remain under pressure for some time, short sellers appear to believe this will weigh on this lithium miner's profits.
- IDP Education Ltd (ASX: IEL) has 13.1% of its shares held short, which is up slightly since last week. This language testing and student placement company is being impacted negatively by student visa changes in a number of key markets.
- Liontown Resources Ltd (ASX: LTR) has 11.1% of its share held short, which is also flat week on week. Liontown will soon be adding more lithium supply to the market, with the Kathleen Valley Project commencing production in the coming weeks.
- Chalice Mining Ltd (ASX: CHN) has short interest of 11%, which is up significantly week on week. Short sellers aren't giving up on this mineral exploration company's shares despite them losing almost 80% of their value over the last 12 months.
- Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest increase to 10.8%. Short sellers continue to target this travel agent giant's shares amid concerns over weak consumer spending and revenue margin headwinds.
- Syrah Resources Ltd (ASX: SYR) has short interest of 10.5%, which is up week on week. This graphite miner's shares have fallen heavily due to weak battery material prices, production suspensions, and ongoing cash burn.
- Australian Clinical Labs Ltd (ASX: ACL) has short interest of 10%, which is up since last week again. This health imaging company has warned that is expecting to report another significant profit decline in FY 2024. Short sellers don't appear to believe improvements are coming any time soon.
- Westgold Resources Ltd (ASX: WGX) has short interest of 9.5%, which is up week on week. Short sellers don't appear supportive of the gold miner's proposed merger with Canada-based Karoa Resources.
- Sayona Mining Ltd (ASX: SYA) has short interest of 9.4%, which is up since last week. At present, Sayona Mining is burning through cash due to its unit costs being higher than its unit sale price.
- Lynas Rare Earths Ltd (ASX: LYC) has seen its short interest rise again to 9.1%. This appears to have been driven by ongoing rare earths price weakness.
