The Polynovo Ltd (ASX: PNV) share price has moved in circles over the past couple of months. This is despite the company reporting positive numbers across its key financial metrics in its half-year results.
At the time of writing, the medical device company’s shares are up 0.64% to $1.10.
While the Polynovo share price has gained 10.2% in the past month, it is down almost 30% since the beginning of 2022.
Polynovo shares continue to be heavily shorted
ASX investor sentiment on the Polynovo share price has been mixed due to the inconsistent performance of the business. This has ultimately attracted a large number of short sellers to the company’s registry.
Short-selling is a common trading strategy that aims to profit from a fall in the price of a security. The goal for an investor is to borrow and sell the shares then buy them back at a lower price for a profit.
Last week, the Australian Securities & Investments Commission (ASIC) released its short position report revealing the level of short interest in companies.
As such, Polynovo remained in the top 10 with 9.87% of its shares being heavily shorted by investors.
In comparison, ASIC had a short interest of 5.44% in Polynovo last year on 7 April. This is almost 50% less than where its shares are shorted today.
Given the large increase in short positions being taken up, it appears investors are concerned about the company’s performance and dwindling cash balance.
Share price summary
Over the past 12 months, the Polynovo share price has continued its downward trend to post a 65% loss.
In comparison, the S&P/ASX 200 Healthcare (ASX: XHJ) sector has lost 4% in the same time frame.
It’s worth noting that the Polynovo share price hit a multi-year low of 83.5 cents on 8 March. This is a stark difference from when it was trading above the $3 mark in April 2021.
Based on today’s price, Polynovo presides a market capitalisation of approximately $727.86 million.
The post Why does the Polynovo share price remain one of the most shorted on the ASX? appeared first on The Motley Fool Australia.
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More reading
- 3 beaten up shares you might be surprised to learn are still part of the ASX 200
- These are the 10 most shorted ASX shares
- March was a stellar month for the Polynovo share price. Here’s why
- Why CBA, Kelsian, PolyNovo, and Weebit Nano shares are pushing higher
- ASX 200 (ASX:XJO) midday update: Block and Zip sink, Paladin Energy raises $200m
Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended POLYNOVO FPO. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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