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Once a 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:
- Flight Centre Travel Group Ltd (ASX: FLT) continues as the most shorted ASX share despite its short interest easing slightly to 17.7%. It appears as though short sellers aren't confident with its valuation or the travel market recovery.
- Betmakers Technology Group Ltd (ASX: BET) has seen its short interest rise again to 12.8%. Reports have suggested that major shareholder, Tom Waterhouse, has been lending some of his shares to short sellers. That's not going to help with sentiment.
- Nanosonics Ltd (ASX: NAN) has short interest of 11.9%, which is down slightly week on week. Short sellers have been going after this infection prevention company after it announced a major and disruptive change to its sales model in the United States.
- Webjet Limited (ASX: WEB) has short interest of 10.4%, which is down slightly week on week. Short sellers appear to believe the market could be too optimistic on the travel market recovery.
- Mesoblast limited (ASX: MSB) has short interest of 9.2%, which is down sharply week on week. Short sellers may have concerns over this biotech's balance sheet after continued cash burn and disappointing trial results.
- Polynovo Ltd (ASX: PNV) has seen its short interest reduce to 9%. This medical device company has been underperforming over the last 12 months. Which isn't a good mix with shares trading on lofty earnings multiples when rates are rising and valuations and being questioned.
- Kogan.com Ltd (ASX: KGN) has seen its short interest remain flat at 9%. Rising marketing costs, inventory issues, sales declines, and the constant threat of Amazon have been weighing on this ecommerce company's shares.
- Redbubble Ltd (ASX: RBL) has short interest of 8.9%, which is down week on week. As with Kogan, this ecommerce company's poor form has been weighing on sentiment. Especially with Apple's privacy setting changes appearing to be hurting margins by leading to higher marketing costs.
- EML Payments Ltd (ASX: EML) has seen its short interest ease to 8.7%. Short sellers may have concerns over its valuation as rates rise and valuations are reassessed.
- Appen Ltd (ASX: APX) has 8.5% of its shares held short, which is up slightly week on week. This could be due to concerns that demand for this artificial intelligence data services company's offering could be softening due to tech giants potentially taking things in-house.
