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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:
- Kogan.com Ltd (ASX: KGN) remains the most shorted share on the ASX with short interest of 11.5%, which was down slightly week on week once again. Short sellers have been targeting Kogan due to significant inventory issues and a slowdown in sales. However, the recent outbreak of COVID-19 has given Kogan's shares a major boost, much to the dismay of short sellers.
- Webjet Limited (ASX: WEB) has seen its short interest rise to 10.6%. Short sellers appear to believe this online travel agent's shares are overvalued given the stuttering travel market recovery. Especially considering the recent outbreak in Sydney.
- Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest ease to 9%. As with Webjet, lockdowns and border closures appear to be weighing on this travel agent as well. There are concerns that the domestic travel market recovery could be derailed by the latest COVID outbreak.
- Inghams Group Ltd (ASX: ING) has 8.8% of its shares held short, which is up week on week once again. Short sellers may have concerns over risks associated with an upcoming major contract renewal with a supermarket giant.
- Electro Optic Systems Hldg Ltd (ASX: EOS) has 8.4% of its shares held short, which is down week on week once again. There are concerns this communications, defence, and space company could be negatively impacted by supply chain issues. Unusual accounting methods and its lack of cash generation could also be weighing on sentiment.
- Tassal Group Limited (ASX: TGR) has short interest of 8.1%, which is down notably week on week. Short sellers may be closing positions on the belief that salmon prices are rebounding.
- Resolute Mining Limited (ASX: RSG) has seen its short interest tumble to 8%. Short sellers may believe this gold miner is now over the worst of its issues. These include production disruption and regulatory concerns.
- Temple & Webster Group Ltd (ASX: TPW) has seen its short interest ease to 7.9%. Short sellers may be regretting this one. As with Kogan, the recent outbreak of COVID-19 has given ecommerce companies a major lift.
- Zip Co Ltd (ASX: Z1P) has short interest of 7.4%, which is up week on week. Short sellers could believe that Zip's Quadpay business will be disrupted by Afterpay's new pay anywhere service.
- Metcash Limited (ASX: MTS) has re-entered the top ten with short interest of 7%. However, unfortunately for short sellers, the Metcash share price is pushing higher today after delivering strong profit growth in FY 2021 and announcing a share buyback.
