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 become the most shorted share again despite its short interest falling week on week to 9.6%. This seafood company has been targeted due to weak salmon prices and concerns that China might slap duties on Australian produce.
- Resolute Mining Limited (ASX: RSG) has seen its short interest ease week on week to 9.4%. Short sellers have been going after this gold miner due to its weak production, disappointing guidance, and (now resolved) political issues relating to its Bibiani operation in Ghana.
- Temple & Webster Group Ltd (ASX: TPW) has seen its short interest jump significantly to 9.4%. Short sellers have been increasing their positions in this online furniture and homewares retailer since it announced plans to invest materially in its growth at the expense of profit margins.
- Kogan.com Ltd (ASX: KGN) has also seen its short interest jump week on week to 9%. Short sellers have been piling in amid concerns over inventory issues, discounting, and its slowing sales growth.
- Flight Centre Travel Group Ltd (ASX: FLT) has short interest of 8.9%, which is down slightly week on week once again. The travel agent's shares have come under pressure since it revealed that its second half loss is expected to be as large as the one recorded in the first half. This was materially more than the market anticipated.
- Webjet Limited (ASX: WEB) has seen its short interest ease notably to 8.4%. The online travel agent has been targeted due to concerns over its valuation and the travel market's stuttering recovery.
- Inghams Group Ltd (ASX: ING) has 8% of its shares held short, which is flat week on week. The recent exit of its CEO and concerns over its contract discussions with Woolworths Group Ltd (ASX: WOW) appear to be weighing on sentiment.
- Megaport Ltd (ASX: MP1) has short interest of 7.8%, which is up again week on week. This high level of short interest appears to have been driven by concerns over the premium its shares trade at compared to the market average.
- Metcash Limited (ASX: MTS) has seen its short interest edge lower to 7.3%. Investors may be concerned by reports that trading conditions are reverting back to normal again in the supermarket industry. This could mean it gives back market share to the big two.
- Zip Co Ltd (ASX: Z1P) has short interest of 6.9%, which is down week on week. Valuation concerns and international expansion execution risks appear to be the main reason for this high level of short interest.
