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:
- Tassal Group Limited (ASX: TGR) has seen its short interest rise to 12.9%. A sharp decline in salmon prices over the last 12 months and concerns over the Australia-China trade war have been weighing on sentiment.
- Webjet Limited (ASX: WEB) has seen its short interest reduce to 10.8%. Short sellers may have been closing positions following the government's announcement of a stimulus package for the tourism industry. In addition, last week Webjet spoke very positively about its longer term outlook at an event.
- Inghams Group Ltd (ASX: ING) has 8% of its shares held short, which is unchanged week on week. Short sellers have been going after the poultry company due to concerns over costs, an unfavourable sales mix, and a potential oversupply of chicken.
- Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest rise slightly to 7.7%. While the travel agent was recently given a boost by a $1.2 billion government stimulus package for the tourism sector, short sellers aren't giving up on it. They appear to believe it is overvalued after a strong share price recovery.
- Bravura Solutions Ltd (ASX: BVS) has experienced another increase in its short interest to 7.7%. Short sellers appear to be targeting the financial technology company due to the significant Brexit and COVID headwinds impacting its business.
- Resolute Mining Limited (ASX: RSG) has seen its short interest reduce week on week to 7.5%. Industrial disruption at its Syama operation has been weighing heavily on sentiment. Particularly given its guidance for another decline in production in FY 2021.
- Metcash Limited (ASX: MTS) has seen its short interest fall to 6.9%. Last week this wholesale distributor released its growth strategy to the market and received a somewhat mixed response due to its higher capex plans.
- Myer Holdings Ltd (ASX: MYR) has short interest of 6.7%, which is down week on week. Short sellers continue to target the department store operator due to the belief that it is in a structural decline.
- Freedom Foods Group Ltd (ASX: FNP) is back in the top ten with 6.7% of its shares held short. Short sellers will have been celebrating this morning after the Freedom Foods share price crashed 94% lower after returning from its nine-month suspension.
- InvoCare Limited (ASX: IVC) has 6.7% of its shares held short. Concerns over market share losses and allegations of anti-competitive conduct in the funeral sector appear to be weighing on sentiment.
