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) is still easily the most shorted ASX share with short interest of 20.6%, which is down week on week. This appears to be due to concerns that weak lithium prices will weigh heavily on its performance for some time to come.
- IDP Education Ltd (ASX: IEL) has 12.9% of its shares held short, which is down slightly since last week. Short sellers have loaded up on this language testing and student placement company's shares after it confirmed that it is being impacted negatively by student visa changes in a number of key markets.
- Australian Clinical Labs Ltd (ASX: ACL) has seen its short interest jump to 11.2%. This health imaging company is expecting to report another significant profit decline in FY 2024. Short sellers don't appear confident that FY 2025 will be much better.
- Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest increase again to 11%. Concerns over weak consumer spending and revenue margin headwinds appear to be behind this. UBS doesn't seem to agree. Last week, the broker upgraded Flight Centre's shares to a buy rating with a lofty $27.80 price target.
- Liontown Resources Ltd (ASX: LTR) has 10.4% of its share held short, which is down week on week. Liontown is another ASX lithium stock being targeted due to weak battery materials prices.
- Syrah Resources Ltd (ASX: SYR) has short interest of 10.4%, which is down a touch week on week. This graphite miner has been struggling with weak battery material prices. This has led to production suspensions and significant cash burn.
- Chalice Mining Ltd (ASX: CHN) has short interest of 9.9%, which is down week on week. This mineral exploration company is still years away from commencing production. As a result, some investors appear to believe the commodity forecasts it is using for its project studies are ambitious.
- Westgold Resources Ltd (ASX: WGX) has short interest of 9.7%, which is up week on week again. This appears to be due to doubts over the gold miner's proposed merger with Canada-based Karoa Resources.
- Sayona Mining Ltd (ASX: SYA) has short interest of 9.1%, which is down since last week. This lithium miner is currently selling its product for less than it costs to produce.
- Cettire Ltd (ASX: CTT) is a new entry in the top ten with 8.9% of its shares held short. The online luxury products retailer has been battling tough trading conditions and criticism of its business model and customer policies.
