Short & Caught: Yep, Flight Centre is still hitting turbulence with short sellers along with lithium stocks

Short sellers think 2023 might be a turbulent trip for Flight Centre, which remains the ASX’s most shorted stock
Several ASX lithium stocks continue to be target of short sellers despite lithium prices ticking upwards from recent lows
Short sellers continue to punt against Betmakers along with several tech and retail stocks

How does shorting work?

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.

The most shorted stocks on ASX

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	24,340,470	217,957,864	11%
CXO	CORE LITHIUM ORDINARY	179,637,128	1,858,516,794	10%
LKE	LAKE RESOURCES ORDINARY	126,548,668	1,422,444,707	9%
MP1	MEGAPORT LIMITED ORDINARY	13,332,961	158,423,600	8%
IEL	IDP EDUCATION LTD ORDINARY	23,198,695	278,336,211	8%
AMA	AMA GROUP LIMITED ORDINARY	83,718,923	1,073,070,217	8%
TPW	TEMPLE & WEBSTER LTD ORDINARY	9,439,697	122,949,702	8%
BRG	BREVILLE GROUP LTD ORDINARY	10,578,006	142,781,365	7%
SHV	SELECT HARVESTS ORDINARY	8,865,047	121,058,664	7%
PLS	PILBARA MIN LTD ORDINARY	217,799,518	2,998,013,519	7%
JBH	JB HI-FI LIMITED ORDINARY	7,660,594	109,333,981	7%
APX	APPEN LIMITED ORDINARY	8,583,971	124,319,061	7%
SYA	SAYONA MINING LTD ORDINARY	620,345,582	9,098,753,133	7%
ZIP	ZIP CO LTD.. ORDINARY	48,822,604	768,865,865	6%
ACL	AU CLINICAL LABS ORDINARY	12,812,858	201,834,015	6%
BRN	BRAINCHIP LTD ORDINARY	110,535,393	1,767,058,145	6%
NVX	NOVONIX LIMITED ORDINARY	29,735,236	486,882,930	6%
ARB	ARB CORPORATION. ORDINARY	4,896,507	81,971,722	6%
OBL	OMNI BRIDGEWAY LTD ORD US PROHIBITED	16,645,294	278,852,475	6%
JRV	JERVOIS GLOBAL LTD ORDINARY	122,581,808	2,079,820,066	6%
BET	BETMAKERS TECH GROUP ORDINARY	54,070,473	943,541,600	6%
BOQ	BANK OF QUEENSLAND. ORDINARY	36,915,518	652,485,010	6%
CCP	CREDIT CORP GROUP ORDINARY	3,841,202	68,066,856	6%
DOW	DOWNER EDI LIMITED ORDINARY	37,185,530	671,573,679	6%
SYR	SYRAH RESOURCES ORDINARY	36,689,139	673,291,724	5%
ABB	AUSSIE BROADBAND ORDINARY	12,666,525	237,682,509	5%
IMU	IMUGENE LIMITED ORDINARY	340,940,887	6,423,039,111	5%
INA	INGENIA GROUP FPO/UNITS STAPLED	21,262,154	407,583,264	5%
HVN	HARVEY NORMAN ORDINARY	64,431,282	1,246,006,654	5%
LLC	LENDLEASE GROUP FPO/UNITS STAPLED	35,247,742	689,322,065	5%
EML	EML PAYMENTS LTD ORDINARY	19,054,617	373,984,129	5%
PBH	POINTSBET HOLDINGS ORDINARY	15,586,662	306,857,645	5%
AWC	ALUMINA LIMITED ORDINARY	145,858,901	2,901,681,417	5%
DYL	DEEP YELLOW LIMITED ORDINARY	36,958,699	755,724,087	5%
PDN	PALADIN ENERGY LTD ORDINARY	143,194,644	2,980,097,705	5%
BOE	BOSS ENERGY LTD ORDINARY	16,861,515	352,578,862	5%
SGM	SIMS LIMITED ORDINARY	9,174,699	193,176,390	5%
WEB	WEBJET LIMITED ORDINARY	18,139,262	382,721,484	5%
FFX	FIREFINCH LTD ORDINARY	55,552,935	1,182,846,577	5%
DMP	DOMINO PIZZA ENTERPR ORDINARY	3,975,298	89,090,402	4%
BLD	BORAL LIMITED. ORDINARY	48,346,644	1,103,088,419	4%
DHG	DOMAIN HOLDINGS AUS ORDINARY	27,566,908	631,657,153	4%
LIC	LIFESTYLE COMMUNITIES. ORDINARY	4,295,268	104,545,131	4%
MTS	METCASH LIMITED ORDINARY	39,594,655	965,541,602	4%
SGR	THE STAR ENT GRP ORDINARY	66,105,048	1,618,680,877	4%
CGC	COSTA GROUP HOLDINGS ORDINARY	18,818,069	464,709,793	4%
INR	IONEER LTD ORDINARY	84,759,378	2,098,338,267	4%
A2M	THE A2 MILK COMPANY ORDINARY	29,084,764	721,976,214	4%
LTR	LIONTOWN RESOURCES ORDINARY	87,292,377	2,198,454,633	4%
ADH	ADAIRS LIMITED ORDINARY	6,815,368	173,050,982	4%
NIC	NICKEL INDUSTRIES ORDINARY	118,874,585	3,024,257,273	4%
NEC	NINE ENTERTAINMENT ORDINARY	66,889,745	1,705,393,253	4%
PNI	PINNACLE INVESTMENT ORDINARY	7,751,900	201,268,091	4%
NXT	NEXTDC LIMITED ORDINARY	18,814,922	495,952,875	4%
29M	29METALSLIMITED ORDINARY	18,274,541	482,052,092	4%
CUV	CLINUVEL PHARMACEUT. ORDINARY	1,867,824	49,410,338	4%
CIP	CENTURIA I REIT ORDINARY UNITS	23,601,753	634,930,635	4%
MSB	MESOBLAST LIMITED ORDINARY	30,184,477	814,204,825	4%
BGA	BEGA CHEESE LTD ORDINARY	11,246,327	304,247,980	4%
NAN	NANOSONICS LIMITED ORDINARY	11,046,035	302,174,713	4%
SUL	SUPER RET REP LTD ORDINARY	8,102,615	225,826,500	4%
BBN	BABY BUNTING GRP LTD ORDINARY	4,814,696	134,906,489	4%
CXL	CALIX LIMITED ORDINARY	6,373,848	181,086,220	4%

Flight Centre still hitting turbulence with short sellers

Flight Centre (ASX:FLT) remains the most shorted stock on ASX. However, its short position has not gone up from May, remaining at 11%.

Short sellers still think 2023 might be a turbulent trip for FLT, despite rising more than 45% YTD after the travel sector continues its recovery from the Covid-19 pandemic.

At the start of 2023 FLT undertook a successful $240 million cap raise to buy Scott Dunn, a leading UK-based luxury travel brand specialising in tailor-made luxury holidays, for an enterprise value of £121 million ($211 million).

Despite headwinds of higher inflation and interest rate rises, FLT at a conference in May said the travel sector continues to be “holding up strongly”.

The company said it is targeting $270m-$290 million underlying EBITDA – previously $250m-$280m excluding Scott Dunn – for FY23.

FLT’s corporate travel sector is also outperforming with total transaction value (TTV) for 10 months to April 30, 2023 already in line with record FY19 full year results.

FLT said strong pipeline of future TTV as new and recent wins are onboarded and start to trade.

The FLT share price today:

Lithium stocks heavily shorted

Sayona Mining (ASX:SYA ), Core Lithium (ASX:CXO), Liontown Resources (LTR)and Lake Resources (ASX:LKE) remain a target of short sellers, continuing to target ASX lithium stocks.

The shorting of lithium stocks comes despite, as Stockhead’s Cameron Drummond reported on Friday, lithium prices in China ticking up again for the week ending June 9.

Carbonate prices rallied up to 305,000 yuan a tonne recently, up from lows of 167,800 yuan a tonne in late April.

While the surge in prices has slightly faded, pricing across the board remain still in the green, with lithium carbonate prices up another 5.5%, while lithium hydroxide was also up 4.4%.

The SYA, CXO LTR, LKE share price today:

Short sellers punt against Betmakers

Short sellers are punting against Betmakers Technology Group (ASX:BET) which has seen its short position over the month climb from 7% to 13% to become the second most shorted stock on the ASX.

BET operates a platform model providing the back-end technology for bookmakers, primarily in horse racing.

The increase in the short position comes despite in late May BET providing an update on a strategic operational restructure as it aims to accelerate its path to profitability.

Normalisation of annualised staff and operating overheads of the business are expected to reduce from $91.5m (H1 FY23) to ~$70m (unaudited) from Q1 FY24, representing a decrease of 23%.

BET said the reduction in cost is primarily driven by restructuring of 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.”

Another ASX betting name Pointsbet (ASX:PBH) has seen its short position marginally drop from 8% to 7% recently with the company announcing in May it plans to sell its PointsBet US business to Fanatics Betting for US$150 million (~A$222 million).

The proposed deal follows a detailed review of a range of strategic options for the North American business. Shareholders will vote on the deal at an EGM on June 30.

PBH said eight of the largest 10 holders, representing 44.58% of the company’s issued capital, have either voted in favour, or have advised that, in the absence of a superior proposal, they support and intend to vote in favour of the sale.

The BET & PBH share price today:

Tech and retail names on short-sellers hit list

The S&P ASX 200 Information Technology was the best performing sector in May, up 11.6% and rising 16.94% YTD on the back of a surge in big names overseas tech names and investor interest in artificial intelligence.

However, short sellers are continuing to target ASX tech stocks, including Megaport (ASX:MP1), Novonix (ASX:NVX), Appen (ASX:APX) and BrainChip Holdings (ASX:BRN).

Brisbane-based NVX shares rallied ~6% last week after the company announced it had inked a deal with one of the biggest manufacturers of electric car batteries in the world, South Korea’s LG Energy Solution (LGES).

MP1 announced at the end of April that it now expects Normalised EBITDA to be materially above market consensus of $9 million in FY23 and $30 million in FY24 following moves to improve the company’s operating and financial performance and cash generation.

MP1 expects to report normalised EBITDA in FY23 in the range of $16 million to $18 million, and normalised EBITDA in FY24 in the range of $41 million to $46 million.

The MP1, NVX, APX & BRN share price today:

Short sellers target retail weakness

Also on the list is BNPL play Zip Co (ASX:ZIP) and several consumer discretionary stocks which could take the toll of higher interest rate rises and cost of living including JB HiFi (ASX:JBH),Baby Bunting (ASX:BBN), City Chic Collective (ASX:CCX), Temple & Webster (ASX:TPW), Adairs (ASX:ADH)and Harvey Norman Holdings (ASX:HVN).

Home furnishing company ADH said recently after a solid sales performance in 1H FY23, the impact of rising interest rates and higher cost of living has created a more subdued trading environment since April with lower traffic observed both in stores and online.