• Travel sector the most shorted
  • Punts bet agains sports betting sector
  • Healthcare not so healthy with short sellers

In Short & Caught, Stockhead recaps the ASX stocks that are the most shorted and have had the greatest increase in short interest right now.

How does shorting work?

Shorting works by selling stocks you do not actually own in the hope of buying them back at a lower price. Investors are in effect betting they will fall.

Because shorting is restricted under Australian law, any substantial shorting of stocks is worth knowing about, even if you only trade long.

Stockhead has utilised the number of short positions as a percentage of total shares on issue. The most shorted ASX stocks all have 5.5 per cent or more.

Here are the top 30 most shorted ASX stocks

Code Company Short positions Shares on issue % short positions
FLT FLIGHT CENTRE TRAVEL ORDINARY 35,739,707 199,747,439 17.9%
BET BETMAKERS TECH GROUP ORDINARY 113,235,404 903,460,347 12.5%
NAN NANOSONICS LIMITED ORDINARY 36,136,801 301,833,182 12.0%
WEB WEBJET LIMITED ORDINARY 38,584,423 380,509,819 10.1%
EML EML PAYMENTS LTD ORDINARY 35,619,292 373,460,316 9.5%
PNV POLYNOVO LIMITED ORDINARY 57,796,782 661,688,044 8.7%
KGN KOGAN.COM LTD ORDINARY 9,329,483 106,926,718 8.7%
Z1P ZIP CO LTD. ORDINARY 57,638,473 669,055,804 8.6%
AMA AMA GROUP LIMITED ORDINARY 84,979,297 1,022,435,377 8.3%
MSB MESOBLAST LIMITED ORDINARY 51,504,050 650,454,551 7.9%
OBL OMNI BRIDGEWAY LTD ORD US PROHIBITED 21,143,023 268,639,670 7.9%
RRL REGIS RESOURCES ORDINARY 54,938,763 754,776,298 7.3%
APX APPEN LIMITED ORDINARY 8,873,199 123,383,996 7.2%
PDN PALADIN ENERGY LTD ORDINARY 191,009,636 2,679,167,890 7.1%
TYR TYRO PAYMENTS ORDINARY 36,471,991 516,771,154 7.1%
PBH POINTSBET HOLDINGS ORDINARY 18,047,456 264,868,212 6.8%
ING INGHAMS GROUP ORDINARY 23,686,139 371,679,601 6.4%
TPW TEMPLE & WEBSTER LTD ORDINARY 7,600,612 120,452,928 6.3%
CUV CLINUVEL PHARMACEUTICALS 3,085,668 49,410,338 6.2%
IEL IDP EDUCATION LTD ORDINARY 16,442,609 278,336,211 5.9%
NEA NEARMAP LTD ORDINARY 27,938,037 498,956,560 5.6%
MFG MAGELLAN FIN GRP LTD ORDINARY 9,326,363 185,713,004 5.0%
NHC NEW HOPE CORPORATION ORDINARY 41,775,768 832,357,082 5.0%
CCX CITY CHIC COLLECTIVE ORDINARY 11,564,056 231,920,086 5.0%
MP1 MEGAPORT LIMITED ORDINARY 7,828,434 157,949,016 5.0%
BRG BREVILLE GROUP LTD ORDINARY 6,809,411 139,359,544 4.9%
ADH ADAIRS LIMITED ORDINARY 8,327,012 170,889,856 4.9%
PME PRO MEDICUS LIMITED ORDINARY 4,977,544 104,372,753 4.8%
RBL REDBUBBLE LIMITED ORDINARY 13,111,572 275,920,223 4.8%

Punters bet against travel sector

The travel sector is the most shorted, while Flight Centre (ASX:FLT)  remains the most shorted stock. Hard hit from the Covid-19 pandemic Flight Centre and the travel sector has been recovering as Australia’s borders started to re-open both domestically and internationally. But short sellers seem to think the market is being too optimistic on the travel industry recovery.

Short positions in Flight Centre is 17.9%,  despite its share price increasing ~4.92% in the past month to be trading at $19.43.

There was also a 10.1% short position in Webjet (ASX:WEB), with the company seeing its share price dropping ~2.40% in the past month to $4.29.

Punters bet against sports betting sector 

Short sellers were betting losses for the sports betting sector which came in as the second most shorted. Betmakers (ASX:BET) was the second most shorted stock with a short position of 12.5%.

Betmakers, which operates a platform model providing the back-end technology for bookmakers primarily in horse racing, has seen its share price has fallen ~51% in the past year to 56 cents.

Pointsbet (ASX:PBH) has been making ground in the US. The company took its first sports book bet in Pennsylvania in February, following authorisation by the state’s gaming body for a soft launch.

Philadelphia represents the company’s 10th online sportsbook operation in the US, following successful launches in New Jersey, Iowa, Indiana, Illinois, Colorado, Michigan, West Virginia, Virginia, and New York.

However, its share price has fallen ~76% in the past year to $3.16.

Healthcare not so healthy

The healthcare sector has been diagnosed as not too well among short sellers. With inflation rising and continued volatility on global markets the healthcare sector has been out of favour of late with investors looking towards more value sectors. 

The S&P/ASX 200 index has fallen ~10% in the past year.   Nanosonics (ASX:NAN), which has developed and commercialised the trophon EPR device, an automated disinfectant technology for ultrasound probes, saw ~12% of its stock shorted.  The company has seen pressure on its stock after it making changes to its US sales model.

Among other health stocks targeted by shorter sellers was Clinuvel (ASX:CUV), despite it releasing positive preliminary results from its pilot study in arterial ischaemic stroke (AIS).

The trial, called CUV801, focused on the safety of multiple afamelanotide doses and patient recovery over 42 days, using the National Institutes of Health Stroke Scale and brain imaging.

Both companies have seen their share prices fall in the past year with Nanosonics down ~35.% to $3.86 and Clinuvel even further at ~42% to $17.22.

Payments, e-commerce, gold stocks among others shorted

Short sellers have also taken aim at payments, e-commerce, gold,  automotive, uranium and tech stocks. EML Payments (ASX:EML) saw ~9.5% of its stock shorted, while Zip Co (ASX:ZIP) ~8.7%.

Crash repair company and auto parts provider AMA Group (ASX:AMA) has 8.3% of its shares held in a short position, while uranium explorer and miner Paladin Energy (ASX:PDN) has 7.1%.

The e-commerce stocks Kogan (ASX:KGN), City Chic Collective (ASX: CCX) and RedBubble (ASX:RBL) also attracted the attention of short sellers.

Gold stock  Regis Resources (ASX:RRL) which has seen its share price drop ~31% in the past year has ~7.3% of its stock in a short position. The company has seen its share price recover slightly of late as gold prices go higher with market volatility.

Linen lovers to linen shorters for Adairs

Homewares and linen company Adairs (ASX:ADH) has also seen ~4.9% of its stock shorted. Adairs has made headlines in recent days for the wrong reasons, with owners of Mocka baby cots sold by the company instructed to check immediately for signs of mould.

The ACCC said in a Facebook post it had “received a number of reports of potentially dangerous mould growing on the base of some cots”.

 

Facebook post by ACCC on the Mocka cot

But it hasn’t been all bad news for Adairs. The company has been tipped by analysts to be a winner from Josh Frydenberg’s big spending Federal budget, aimed to alleviate some cost of living pressures. 

The Adairs share price has fallen ~24% in the past year but has recovered ground in the past month, up 1.75% to $2.91.