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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:
- Telix Pharmaceuticals Ltd (ASX: TLX) has become the most shorted ASX share after its short interest increased to 16.2%. While short sellers have been targeting this radiopharmaceuticals company due to US FDA approval challenges, this latest increase is likely attributable to convertible-arbitrage hedging tied to Telix's US$600 million convertible bond refinancing.
- Domino's Pizza Enterprises Ltd (ASX: DMP) has seen its short interest rise to 15.6%. There appear to be doubts around this pizza chain operator's turnaround strategy.
- Polynovo Ltd (ASX: PNV) has 14% of its shares held short, which is up since last week. This medical device company's shares trade on high earnings multiples. It seems that short sellers think they could be overvalued.
- Guzman Y Gomez Ltd (ASX: GYG) has short interest of 13.9%, which is up week on week. Although this quick service restaurant operator released a better than expected update this month, short sellers aren't giving up. They seem to have concerns over its struggling US business.
- Treasury Wine Estates Ltd (ASX: TWE) has 13% of its shares held short, which is flat since last week. Short sellers will have been disappointed to see this wine giant's shares jump last week following a surprisingly positive trading update.
- Flight Centre Travel Group Ltd (ASX: FLT) has short interest of 12.5%, which is down week on week. There are concerns that travel demand could be impacted by the Middle East conflict and higher airfares.
- Zip Co Ltd (ASX: ZIP) has 11.9% of its shares held short. This is down week on week. Some short sellers may have been closing positions after the buy now pay later provider impressed with its quarterly update this month.
- Boss Energy Ltd (ASX: BOE) has short interest of 11.6%, which is up since last week. There are concerns about this uranium miner's production outlook beyond 2026.
- DroneShield Ltd (ASX: DRO) has 11.5% of its shares held short, which is down since last week. Valuation concerns may be why short sellers are targeting this counter-drone technology company.
- Lotus Resources Ltd (ASX: LOT) has short interest of 11%, which is flat week on week. It is another uranium producer that short sellers are targeting.
