10 stocks with a jump in short interest: Lithium miners and losers from last year

Welcome back to another Monthly Short Seller Series where we take a look at companies experiencing a notable month-on-month jump in short interest.

The data refers to short interest changes between 23 December 2022 and 30 January 2023.

Interesting observations

There's a fairly consistent theme among the stocks experiencing a rise in short interest this month. They're generally stocks that have either sold off sharply in recent months or beaten down for a very long time. Amid the recent resurgence for markets, those stocks are trying to bottom and work their way back up. However, shorts are saying otherwise. So whose leading who?

Lithium shorts grind higher: Most mid-to-large cap lithium names are trying to bottom after the volatile November/December sell last year. Heavyweight Pilbara Minerals is leading the charge, up 34% year-to-date. While the performance among mid-cap and emerging names remains mixed. Still, short interest continues to grind higher.

Liontown Resources short interest (Source: Shortman)

Another rising short name: Healius has experienced a steady increase in short interest since July last year – when the percentage of shorted stock was only around 0.3%. Now its 4.20%. Still, Healius shares are up around 4% year-to-date but down -28% in the past twelve months.

The bearish narrative for Healius is pretty simple: The business experienced a massive pull forward in earnings thanks to revenue from PCR testing. In its November 2022 trading update, the company said Covid-19 testing numbers have fallen from 13,000 tests per day in July to 3,000 to 4,000 in October. Its EBITDA for the first four months to October 2022 was down -64.1%.

Healius short interest (Source: Shortman)

Crossroad for shorters: ARB Corp was one of those companies whose valuation ballooned during Covid but when the bubble popped, the stock fell as much as -55%. Its now trying to bottom, up almost 25% year-to-date. Still, short interest refuses to back down, up around 0.5% year-to-date to 6.45%.

ARB Corp short interest (Source: Shortman)