The 10 most shorted ASX stocks plus the biggest risers and fallers – Week 29

Welcome back to the Short Seller Series – A recap of the most heavily shorted stocks on the ASX and those experiencing significant changes to short interest over the past week.

Short selling data is four days behind today's date because reporting is not mandatory until three business days after the trade. The tables below will compare:

• Week-on-week changes between 9 July and 16 July 2024

• Month-on-month changes between 18 June and 16 July 2024

Most Shorted

Interesting takeaways:

• Pilbara Minerals and IDP Education: Remain the two most shorted stocks on the market. The two stocks have retained the top spots since early February.

• Flight Centre: Short interest has ticked above 11% for the first time since May. Earlier this month, Macquarie retained an Outperform rating on the stock, citing Flight Centre's attractive earnings growth outlook and "significant upside to out FY25 expectations if the 2% underlying profit before tax TTV target is achieved."

• Australian Clinical Labs: Recorded the highest week-on-week change in short interest among the most shorted names. The pathology sector continues to face headwinds due to subdued volumes and a downturn in GP referrals. ACL downgraded its full-year guidance during February reporting season.

Rising Shorts

Interesting takeaways:

• IPH: Macquarie recently reported that IPH's Australian filing volumes decreased by 2.8% year-on-year in the second half of FY24, underperforming the overall market, which saw a 1.4% decline.

• Lotus Resources: The uranium explorer Lotus has retraced nearly all of its 67% year-to-date gain. This decline aligns with the broader pullback in uranium prices, which have retreated to year-to-date lows of US$85/lb from recent highs of almost US$110.

• Cettire: The recent increase in Cettire's short interest is unsurprising given recent controversies surrounding tax allegations, a profit downgrade, and insider selling. In late June, Cettire issued updated guidance, projecting FY24 EBITDA between $32-35 million, 22-29% below consensus. Notably, this trading update only included three metrics (sales revenue, marketing-to-sales ratio, and adjusted EBITDA), in contrast to previous updates that provided more than seven additional metrics.

Most Covered

Interesting takeaways:

• Gold stocks: Bellevue Gold, West African Resources, and Emerald Resources have seen a decrease in short interest. This follows gold prices reaching a record high of US$2,469 an ounce last week. However, prices have since pulled back sharply, dropping 3% over the last five sessions to US$2,395.

• Champion Iron: Since late May, Champion Iron shares have declined by approximately 20% due to various production challenges. The company's flagship Bloom Lake project faced logistics issues, preventing full shipment capacity in the March quarter. More recently, Champion Iron temporarily shut down Bloom Lake in response to local forest fires.

• Lifestyle Communities: On Monday, July 15, Lifestyle Communities experienced a significant one-day selloff of 18%. This sharp decline was triggered by ABC media coverage highlighting homeowner dissatisfaction with the company's communities at Wollert in northwest Melbourne, leading to applications filed with the Victorian Civil and Administrative Tribunal. It appears that short sellers capitalised on this price gap to take profits.