Short & Caught: Flight Centre still hitting turbulence with short sellers
Link copied to
Short sellers effectively borrow a stock from a broker, and go wager it (sell it) on the open market. The plan is to then buy the same stock back later after it’s made a hefty drop in price. That done, the short seller buys it back at the lower price and returns it to the lender.
The difference between the sell price and the buy price is the short seller’s profit. Investors are in effect betting they will fall.
Because shorting is restricted under Australian law (and because it’s an all or nothing bloodsport) any substantial shorting of stocks is worth knowing about, even if you only trade long.
And perhaps there’s method in the madness.
Stockhead has utilised the number of short positions as a percentage of total shares on issue. The most ASX shorted stocks (excluding CDIs) all have 5% or more.
Swipe or scroll to reveal full table. Click headings to sort:
|Code||Company||Short positions||Shares on issue||% short positions|
|FLT||FLIGHT CENTRE TRAVEL ORDINARY||22,613,543||218,075,660||10%|
|CXO||CORE LITHIUM ORDINARY||184,266,674||1,858,516,794||10%|
|IEL||IDP EDUCATION LTD ORDINARY||26,139,887||278,336,211||9%|
|JBH||JB HI-FI LIMITED ORDINARY||8,933,753||109,333,981||8%|
|AMA||AMA GROUP LIMITED ORDINARY||85,661,334||1,073,070,217||8%|
|LLC||LENDLEASE GROUP FPO/UNITS STAPLED||54,440,313||689,322,065||8%|
|SHV||SELECT HARVESTS ORDINARY||9,329,710||121,058,664||8%|
|TPW||TEMPLE & WEBSTER LTD ORDINARY||9,202,884||122,949,702||7%|
|BRN||BRAINCHIP LTD ORDINARY||131,834,862||1,767,058,145||7%|
|SYR||SYRAH RESOURCES ORDINARY||48,216,798||675,897,730||7%|
|BRG||BREVILLE GROUP LTD ORDINARY||9,913,801||142,781,365||7%|
|DMP||DOMINO PIZZA ENTERPR ORDINARY||5,786,836||89,090,402||6%|
|LKE||LAKE RESOURCES ORDINARY||89,792,720||1,422,444,707||6%|
|ACL||AU CLINICAL LABS ORDINARY||12,646,350||201,834,015||6%|
|NVX||NOVONIX LIMITED ORDINARY||30,153,727||486,882,930||6%|
|OBL||OMNI BRIDGEWAY LTD ORD US PROHIBITED||17,204,424||278,852,475||6%|
|DOW||DOWNER EDI LIMITED ORDINARY||41,187,928||671,573,679||6%|
|PLS||PILBARA MIN LTD ORDINARY||183,403,630||2,998,013,519||6%|
|IMU||IMUGENE LIMITED ORDINARY||387,973,534||6,423,039,111||6%|
|ARB||ARB CORPORATION. ORDINARY||4,792,931||81,971,722||6%|
|HVN||HARVEY NORMAN ORDINARY||72,758,854||1,246,006,654||6%|
|BOQ||BANK OF QUEENSLAND. ORDINARY||37,080,335||652,485,010||6%|
|SGM||SIMS LIMITED ORDINARY||10,727,419||193,176,390||6%|
|AWC||ALUMINA LIMITED ORDINARY||160,176,782||2,901,681,417||6%|
|MP1||MEGAPORT LIMITED ORDINARY||8,706,875||158,678,412||5%|
|ELD||ELDERS LIMITED ORDINARY||8,463,220||156,476,574||5%|
|EML||EML PAYMENTS LTD ORDINARY||19,774,010||373,984,129||5%|
|WBT||WEEBIT NANO LTD ORDINARY||9,697,063||187,318,680||5%|
|CCP||CREDIT CORP GROUP ORDINARY||3,465,575||68,066,856||5%|
|APX||APPEN LIMITED ORDINARY||7,959,557||156,653,558||5%|
|WEB||WEBJET LIMITED ORDINARY||19,361,331||382,721,484||5%|
|JRV||JERVOIS GLOBAL LTD ORDINARY||103,057,126||2,079,820,066||5%|
|ZIP||ZIP CO LTD.. ORDINARY||40,196,583||824,646,536||5%|
|BBN||BABY BUNTING GRP LTD ORDINARY||6,434,373||134,906,489||5%|
|BET||BETMAKERS TECH GROUP ORDINARY||44,918,203||943,541,600||5%|
|DHG||DOMAIN HOLDINGS AUS ORDINARY||29,952,727||631,657,153||5%|
|LYC||LYNAS RARE EARTHS ORDINARY||44,154,777||933,815,477||5%|
|SYA||SAYONA MINING LTD ORDINARY||427,906,918||9,098,753,133||5%|
|INA||INGENIA GROUP FPO/UNITS STAPLED||18,961,812||407,583,264||5%|
|DYL||DEEP YELLOW LIMITED ORDINARY||34,172,366||757,743,572||5%|
|MSB||MESOBLAST LIMITED ORDINARY||36,600,066||814,204,825||4%|
|ABB||AUSSIE BROADBAND ORDINARY||10,638,992||237,682,509||4%|
|PDN||PALADIN ENERGY LTD ORDINARY||128,273,622||2,981,128,947||4%|
|LIC||LIFESTYLE COMMUNIT. ORDINARY||4,432,930||104,545,131||4%|
|BLD||BORAL LIMITED. ORDINARY||46,488,232||1,103,088,419||4%|
|NAN||NANOSONICS LIMITED ORDINARY||12,484,672||302,174,713||4%|
|BGA||BEGA CHEESE LTD ORDINARY||12,492,102||304,247,980||4%|
|A2M||THE A2 MILK COMPANY ORDINARY||29,390,964||721,976,214||4%|
|INR||IONEER LTD ORDINARY||83,344,057||2,098,818,267||4%|
|NIC||NICKEL INDUSTRIES ORDINARY||116,834,490||3,024,257,273||4%|
|GUD||G.U.D. HOLDINGS ORDINARY||5,433,914||140,894,696||4%|
|BOE||BOSS ENERGY LTD ORDINARY||13,558,873||352,578,862||4%|
|SUL||SUPER RET REP LTD ORDINARY||8,652,460||225,826,500||4%|
|NHC||NEW HOPE CORPORATION ORDINARY||33,685,949||882,269,477||4%|
|MFG||MAGELLAN FIN GRP LTD ORDINARY||6,814,260||181,431,899||4%|
|NEC||NINE ENTERTAINMENT ORDINARY||62,516,211||1,705,393,253||4%|
|SGR||THE STAR ENT GRP ORDINARY||59,025,069||1,618,680,877||4%|
|PBH||POINTSBET HOLDINGS ORDINARY||11,111,921||311,609,766||4%|
|BGL||BELLEVUE GOLD LTD ORDINARY||40,246,930||1,130,179,529||4%|
|MTS||METCASH LIMITED ORDINARY||34,107,416||965,541,602||4%|
|CXL||CALIX LIMITED ORDINARY||6,366,482||181,086,220||4%|
It seems Flight Centre (ASX:FLT) just can’t catch a break with short sellers, with the travel stock remaining the most shorted ASX stock.
However, FLT’s short position has dropped marginally from 11% in June to 10% in July. The FLT share price has risen more than 40% YTD as the company said it is continuing to recover from the Covid-19 travel disruptions.
In its June Investor Strategy Session FLT said it was targeting $270-290 million underlying EBITDA for FY23 including contribution from the recent Scott Dunn acquisition, compared to an underlying $183.1 million FY22 loss.
“Demand is rebounding, trading conditions gradually starting to normalise (although airfares remain well above pre-Covid levels), no obvious signs of slowdown flowing from macro-economic changes,” FLT said in the presentation.
“Global corporate business outpacing industry recovery – delivering record TTV during FY23 despite client activity only tracking at 70-80% of pre-COVID levels.”
FLT said the leisure sector recovery gained momentum during a seasonally busier H2 FY23.
“Australian leisure TTV tracking broadly in line with pre-Covid levels in May 2023,” FLT said.
Betmakers Technology Group (ASX:BET) has caught a break with short-sellers and has seen its short position over the month more than halve from 13% in June as the second most shorted stock on the ASX to 5% in July.
BET operates a platform model providing the back-end technology for bookmakers, primarily in horse racing.
The BET share price has risen 18% in the past month after it provided an update on a strategic operational restructure as it works to cut costs and accelerate its path to profitability.
The company said it will cut more than 100 jobs but the reduction in costs will be primarily driven by restructuring global operations and technology.
“BetMakers is committed to providing long-term value to shareholders and this restructuring is an essential step towards achieving that goal,” CEO Jake Henson said.
“The changes made aim to provide the business with a clear path to profitability while also providing a more streamlined operating structure to maximise future growth opportunities.”
Resource stocks across sectors including lithium, battery metals, coal, nickel and REEs are in the sights of short-sellers.
There’s a lot going on in the lithium sector. Lithium prices have fallen from the heights seen in 2022 but are coming back in vogue.
However, analysts are mixed about what lithium prices will do with some forecasting EV growth will continue to drive demand for the battery metal but others like Goldman Sachs are bearish and say there could be a supply glut as early as 2024.
Also on the list of most shorted stocks is copper-focused base and precious mining company 29Metals (ASX:29M), the world’s biggest rare earths producer outside of China Lynas Rare Earths (ASX:LYC), coal miner New Hope Corp (ASX:NHC) and Nickel Industries (ASX:NIC).
NIC in June announced it had begun commissioning its Oracle Nickel Project power plant in the Indonesia Morowali Industrial Park in Central Sulawesi.
It’s a key step to expanding production from the 70% owned project’s four RKEF lines, which have been restricted to 80% of nameplate due to power limits on the IMIP grid. The company said it plans to steadily increase to 130% of nameplate capacity.
IDP Education Limited (ASX:IEL) is also on the list of short sellers. IEL specialises in international student placement services and high-stakes English language testing.
The company also operates English language schools in Southeast Asia and organises educational events and conferences across the globe.
IDP hasn’t had much news out in the past month but fell 15% on May 29 on no news. When queried by the ASX, IDP said Canada’s decision to recognise additional providers for English language proficiency for its visa scheme wasn’t expected to have a material impact on its FY23 revenue or earnings.
Several consumer discretionary stocks which could take the toll of higher interest rate rises and cost of living also continue to be targeted by short-sellers including JB HiFi (ASX:JBH), Harvey Norman Holdings (ASX:HVN), Baby Bunting (ASX:BBN) and Temple & Webster (ASX:TPW).