The BHP Group Ltd (ASX: BHP) share price is sliding on Monday.

Shares in the S&P/ASX 200 Index (ASX: XJO) mining giant closed on Friday trading for $48.32. At the time of writing, shares are swapping hands for $48.09, down 0.5%.

That’s right about in line with the 0.4% loss posted by the S&P/ASX 200 Resource Index (ASX: XJR).

So, what’s all this about super-profit tax fears?

Why is the ASX 200 miner concerned about taxes?

The BHP share price is sliding amid news out from the ASX 200 miner’s pre-budget submission to the federal government expressing concerns over the business outlook in Australia.

As The Australian reports, BHP’s management is worried the company could be in the crosshairs of treasurer Jim Chalmers as the government looks for additional revenue.

The miner believes the federal government may take a page out of Queensland’s book and legislate a super-profit tax.

As you likely recall, in 2022, Queensland’s state government passed a controversial outsized increase to coal royalties amid rocketing prices for the black gold.

That move was not well received by the big miners. BHP’s CEO Mike Henry went so far as to pause any new capex on mine expansions in Queensland.

And the Australian federal government is on notice it could face a similar cutback in new domestic project funding.

“Any attempt to address structural pressures on the budget by increasing the tax burden on business will result in a similar outcome: reduced investment, fewer jobs and, in the long term, lower living standards for Australians,” BHP stated in its pre-budget submission.

While there are no clear indications yet of Chalmers’ plans, BHP certainly has plenty of ‘super-profits’ the government might be interested in taking a slice of.

The ASX 200 miner’s half-year results were down from the previous year’s half and came in below some expectations, which saw the BHP share price close down 0.3% the day the company reported.

Yet revenue of US$25.7 billion and profit after tax of US$6.5 billion might be hard for the cash strapped Albanese government to ignore.

Stay tuned.

BHP share price snapshot

As you can see in the chart below, the BHP share price has rebounded strongly since early November and is currently up 6% in 2023.

The post BHP share price stumbles amid super-profit tax fears appeared first on The Motley Fool Australia.

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More reading

• Why I don’t own BHP shares (yet)
• Have BHP shares always paid better dividends than Rio Tinto?
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares today
• BHP share price on track for biggest daily gain in almost four months

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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 Scott Phillips.

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The Core Lithium Ltd (ASX: CXO) share price is having a solid start to the week.

In early trade, the lithium miner’s shares were up as much as 11% to $1.07.

Core Lithium’s shares have pulled back a touch since then but remain up 6% to $1.02.

Why is the Core Lithium share price shooting higher?

Investors have been scrambling to buy the company’s shares on Monday after it released an update on the Finniss Lithium Operation mineral resource.

According to the release, drilling completed as part of the ongoing Finniss Lithium Operation exploration program has led to its mineral resource estimate more than doubling from 4.37Mt at 1.53% lithium oxide to 10.1Mt @ 1.48% lithium oxide.

But it may not stop there. The company notes that further significant growth opportunities exist beyond currently modelled resource domains at Carlton, Ah Hoy, Hang Gong, and Sandras. In light of this, plans are now in place to continue its exploration efforts in 2023 and another update to the global mineral resource and ore reserve estimate for Finniss is underway.

Core Lithium’s CEO, Gareth Manderson, was pleased with the news and remains very optimistic on the future. He said:

This upgrade is a credit to our exploration and technical teams, who are systematically exploring the Finniss tenements while the business moves into production. These results provide further confirmation of the prospectivity of Core Lithium’s ground holding.

Importantly, BP33 remains open at depth. Exploration to extend mine life at Finniss and identify growth opportunities is a priority for the business, with an expanded drilling program for CY23.

As you can see on the chart below, it has been a volatile but successful 12 months for the Core Lithium share price. It is now up over 12% since this time last year.

The post Why is the Core Lithium share price soaring 11% today? appeared first on The Motley Fool Australia.

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More reading

• Here are the 10 most shorted ASX shares this week
• What’s happening with ASX 200 lithium stocks this week?
• Investing in ASX 200 lithium stocks? Here’s why this 6% decline in China matters
• Why ASX 200 lithium shares are eyeing this surprising new Chinese move
• The Core Lithium share price has crashed 20% in February. What now?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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 Scott Phillips.

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Fund manager Matthew Haupt from Wilson Asset Management (WAM) has identified some of the most important factors that investors should consider in 2023 with their ASX share portfolio.

Last year saw a large change to the economic landscape as central banks in Australia, the United States and elsewhere ramped up interest rates to try to tame inflation.

In Haupt’s view, the economy is likely to slow this year and that could end up having a damaging impact on “bad management teams and poor strategies”, according to reporting by The Australian.

What’s going on with the economy?

A month ago, the Reserve Bank of Australia (RBA) increased the Australian cash rate target by 25 basis points to 3.35%. It’s expected to increase the interest rate again to 3.6% this week.

Households and ASX shares are now feeling the impact of those rate rises.

While the six months to 31 December 2022 saw “strong resilience” by many companies, the environment has “clearly turned”, according to The Australian’s reporting.

Inflation has helped the revenue side for some businesses, but costs are also going higher – wages, fixed costs, and borrowing costs are more expensive, Haupt noted.

Haupt said:

Best breed management will shine in this environment, whereas the weak will get shown up. If you’ve got the wrong management, wrong culture and wrong strategy, it all falls apart.

Now it is crunch time. Managers have two choices: cut jobs and increase productivity. Good ones will do a combination of both – bad managers will probably just cut jobs.

Time to be defensive?

The WAM Leaders portfolio is positioned defensively, with a strong allocation to infrastructure names like Atlas Arteria Group (ASX: ALX) and Transurban Group (ASX: TCL).

The idea is that infrastructure can, and tends to, perform well regardless of what’s happening in the economy. At the moment, there are a number of negative indicators, including slowing business and consumer confidence.

Another name that Haupt pointed out was high-quality office owner DEXUS Property Group (ASX: DXS) which trades at a 40% discount to its net tangible assets (NTA). That one looks “compelling” despite the economic outlook.

Other names included packaging business Orora Ltd (ASX ORA), and insurer QBE Insurance Group Ltd (ASX: QBE), which is benefiting from rising interest rates and hiking insurance premiums.

However, Haupt is becoming more cautious about ASX bank shares. Not necessarily because of bad debts but due to strong competition that could hurt their margins.

Haupt suggested that interest rates could stay higher for years. He said:

We could be in for a (Alan) Greenspan era where you’re cutting, raising and cutting rates as we navigate inflation. That’s why it’s prudent to have the slight defensive view.

Defensives do well when the economy goes bad, but defensives do well when interest rates fall too. The cash flows means you’re going to get revalued up. That makes them a safe bet right now.

The post Why you need defensive ASX shares in your portfolio right now: WAM appeared first on The Motley Fool Australia.

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More reading

• Give yourself a passive income boost with these ASX dividend shares: experts
• Passive income watch: Here are the ASX 200 shares that delivered some of the biggest dividend boosts this earnings season
• 5 high-profile ASX 200 shares that will trade ex-dividend on Monday
• 3 ‘quality’ ASX shares to buy now before they rocket: experts
• 6 ASX 200 directors buying up their company shares in the past week

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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 Scott Phillips.

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The Brainchip Holdings Ltd (ASX: BRN) share price is having a strong start to the week.

In morning trade, the struggling semiconductor company’s shares are up 10% to 56 cents.

Why is the Brainchip share price jumping?

Investors have been bidding the Brainchip share price higher on Monday after the company released an announcement.

According to the release, Brainchip has launched the second generation of its Akida platform that drives edge devices for the Artificial Intelligence of Things (AIoT) solutions and services market.

The release notes that the new platform adds efficient 8-bit processing to go with advanced capabilities such as time domain convolutions and vision transformer acceleration. It claims that this provides an unprecedented level of performance in sub-watt devices, taking them from perception towards cognition.

Brainchip’s CEO, Sean Hehir, advised that the new platform was influenced by customer feedback. He said:

Our customers wanted us to enable expanded predictive intelligence, target tracking, object detection, scene segmentation, and advanced vision capabilities. This new generation of Akida allows designers and developers to do things that were not possible before on an Edge device. By inferring and learning from raw sensor data, we take a substantial step toward a cloudless Edge AI experience. With this launch, we have significantly extended our competitive advantage in neuromorphic AI.

Hehir also appears hopeful that this will lead to “revenue growth” over the coming years. Which certainly is needed after the company recorded a pitiful US$250k of revenue during the second half of 2022. He added:

The development of the second generation of Akida was strongly influenced by our customers’ feedback and driven by our extensive market engagement. We have recently expanded our sales organisation to become truly global and we are focused on executing more IP licence agreements and generating revenue growth over coming years.

Time will tell if this is a turning point for the meme stock.

The post Brainchip share price jumps 10% on Akida platform news appeared first on The Motley Fool Australia.

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More reading

• Why has the BrainChip share price crashed 25% in a month?
• Why Brainchip, Coles, Karoon Energy, and Pilbara Minerals shares are tumbling
• Why Brainchip, Cooper Energy, Link, and Telstra shares are dropping today
• Brainchip share price higher despite US$22m loss
• BrainChip share price rebounds 9% following speeding ticket

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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 Scott Phillips.

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The Bendigo and Adelaide Bank Ltd (ASX: BEN) share price is down 3.1% in early trade on Monday.

Shares in the S&P/ASX 200 Index (ASX: XJO) bank stock closed on Friday trading for $9.60. In early morning trade on Monday, shares are trading for $9.30.

So, why is the Bendigo Bank share price sliding lower today?

What are ASX 200 investors considering?

With the S&P/ASX 200 Financials Index (ASX: XFJ) up 0.3%, most of the selling pressure on the Bendigo Bank share price appears to stem from the fact the stock is trading ex-dividend today.

The bank reported its half-year financial results on 20 February (1H FY23).

With statutory net profits increasing 49% from 1H FY22 to reach $249 million, the bank declared a fully franked interim dividend of 29 cents per share. The Bendigo Bank share price closed up 1.8% on the day.

Investors buying the bank stock today will no longer be eligible to receive that payout. Hence the lower opening price today, with the stock down 30 cents per share, almost equivalent to its dividend.

Commenting on the bank’s dividend payout, CEO Marnie Baker said:

The board has declared a fully franked dividend of 29.0 cents per share, an increase of 9.4% on the prior half. A DRP (dividend reinvestment plan) has also been announced.

With APRA’s approval the Board intends to neutralise the impact of the DRP by arranging for a third party to purchase the shares on market rather than issue additional shares.

Eligible investors can expect to receive that payment on 31 March.

At Friday’s closing share price, that represents a yield of 3.0%. Add in the 26.5 cents per share final dividend payout from September, and Bendigo Bank shares pay a fully franked trailing dividend yield of 5.8%.

“These decisions support our strong capital position and our business outlook,” Baker said.

That includes the bank’s “expectation of residential lending growth at or above system over the long term while balancing our commitment to support our shareholders with a reasonable return on their investment,” she added.

Bendigo Bank share price snapshot

As you can see in the chart below, the Bendigo Bank share price is up 2.3% over the past 12 months, despite this morning’s retrace. Including the 55.5 cps in dividends, the bank’s shares have returned 8.5% over the full year.

The post Why is the Bendigo Bank share price sliding lower today? appeared first on The Motley Fool Australia.

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More reading

• 5 high-profile ASX 200 shares that will trade ex-dividend on Monday
• Hoping to bag the boosted Bendigo Bank dividend? Here’s how
• 6 ASX 200 directors buying up their company shares in the past week
• Here are the top 10 ASX 200 shares today
• Bendigo Bank share price volatile amid 50% profit boost

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Bendigo And Adelaide Bank. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Share prices are changing all the time, but value investors might be able to find standout opportunities in this uncertain time. I think there are some exciting, cheap ASX shares to consider.

I think that some of the smaller names on the ASX could be underrated by investors, particularly ones that aren’t highly followed.

Both of the below could deliver outperformance in the next year in my opinion.

Estia Health Ltd (ASX: EHE)

Estia is one of the largest aged care operators in Australia. It delivers services across 72 homes, with the company owning 66 of them. Those homes have 6,596 operational places.

The business recently reported its FY23 half-year result, which showed a 9% increase in revenue to $359.2 million. Its average occupancy increased from 90.6% to 91.9%.

The impacts of COVID-19 are easing and the business is seeing “positive momentum”. It continues to make bolt-on acquisitions, while the ASX share’s share buyback is expected to recommence in April.

The Estia Health CEO Sean Bilton said:

Opportunities for growth are expected to be available in keeping with our strategy to grow sustainably, including through the purchase of high quality homes with attractive upside.

We remain confident that the fundamental drivers of the sector will remain strong for those residential aged care providers who put residents at the centre of their operating model and perform in a financially sustainable manner.

According to Commsec numbers, Estia Health is valued at 17 times FY23’s estimated earnings with a potential forward grossed-up dividend yield of 6.7%. That valuation includes the business owning a large property portfolio worth hundreds of millions of dollars.

Metcash Limited (ASX: MTS)

Metcash is a diversified business that supplies IGA supermarkets around the country. It also supplies independent liquor businesses in Australia such as Cellarbrations, The Bottle-O, IGA Liquor, and Porters Liquor.

Finally, the business has a hardware division with brands in it like Mitre 10, Home Timbet & Hardware and Total Tools. Combined, its hardware network has more than 700 stores located in metro and regional areas.

I think of Metcash as a cheaper version of businesses like Wesfarmers Ltd (ASX: WES) and Coles Group Ltd (ASX: COL). According to Commsec, it’s only valued at 13 times FY23’s estimated earnings with a possible grossed-up dividend yield of 7.9%.

Metcash can benefit from ongoing store rollouts, improvements in its logistics and online offerings, and scale advantages.

I think that Metcash’s earnings (like food and liquor) can be resilient even in a downturn, so I think it could be a smart pick at today’s price.

The post I think value investors would love to buy these 2 cheap ASX shares appeared first on The Motley Fool Australia.

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More reading

• 3 ASX shares I’d buy for passive income instead of BHP’s declining dividend
• How I’d invest $20K in ASX shares to target $1,000 in annual passive income
• How much do you need in ASX shares to give up work and live only off dividend income?
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Coles Group and Wesfarmers. The Motley Fool Australia has recommended Metcash. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Every three months, S&P Dow Jones Indices announces its quarterly rebalance of the S&P/ASX Indices.

This sees a number of ASX shares move into and out of particularly indices, such as the All Ordinaries index, the S&P/ASX 200 Index, and the S&P/ASX 100 index.

On Friday, the index solutions company released its latest rebalance of these indices and revealed that four shares will be dumped from the widely followed, benchmark ASX 200 index when the index rebalances in two weeks on 20 March.

Which ASX 200 shares are being dumped?

The four ASX 200 shares that will be kicked out later this month are building materials company Adbri Ltd (ASX: ABC), battery technology company Novonix Ltd (ASX: NVX), gold miner Ramelius Resources Ltd (ASX: RMS), and fleet management company Smartgroup Corporation Ltd (ASX: SIQ).

Normally, this sort of news would put a lot of pressure on a company’s share price. That’s because the sell side will soon become stacked with sell orders from funds that track the index and fund managers that have strict investment mandates allowing them to only invest in companies in the ASX 200 index and above.

However, with the market charging higher today following a very strong night of trade on Wall Street on Friday, these shares aren’t faring too badly given the circumstances. Here’s that state of play:

• The Adbri share price is up 1%
• The Novonix share price is 2.5%
• The Ramelius share price is up 1%
• The Smartgroup share price is down slightly

Replacing these ASX 200 shares in the illustrious index will be location technology company Life360 Inc (ASX: 360), construction and mining contractor NRW Holdings Limited (ASX: NWH), medical device company Polynovo Ltd (ASX: PNV), and graphite producer Syrah Resources Ltd (ASX: SYR).

The post These ASX shares are being dumped from the ASX 200 index this month appeared first on The Motley Fool Australia.

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More reading

• Should I buy Flight Centre shares at $19?
• These 4 ASX shares could rocket this month: Here’s why
• This ASX 200 dividend share failed to be one of the world’s biggest payers in 2022. Could it get worse?
• 5 things to watch on the ASX 200 on Monday
• I’d invest $20 a week the Warren Buffett way as I aim to build wealth

Motley Fool contributor James Mickleboro has positions in Life360. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360 and PolyNovo. The Motley Fool Australia has positions in and has recommended Smartgroup. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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I like to own ASX shares that I could potentially own forever. Certainly, BHP Group Ltd (ASX: BHP) could be one of the names that enters my portfolio at some point.

BHP has already shown that it has excellent longevity. It’s one of the oldest businesses on the ASX at more than 100 years old.

I believe that resources are always going to be in demand around the world. BHP has a diversified portfolio of commodities including iron, copper, nickel, and coal.

Typically, I don’t think that many commodity businesses can make great investments. However, at the right price, I think a forward-thinking business is worthwhile, particularly if it’s able to generate strong profits when commodity prices are favourable.

Keep in mind that I already own Fortescue Metals Group Limited (ASX: FMG) shares in my portfolio, so owning BHP shares at some point wouldn’t be too much of a stretch.

Why I’m not invested already

BHP is already one of the biggest businesses in the world. It’s the biggest Australian company and for that reason, it could be tricky for the business to achieve substantial capital growth.

According to the ASX, it has a market capitalisation of $243 billion. For it to organically double in size, it would need to be worth almost $500 billion. Therefore, I’d want to buy at the right price.

After a 30% rise over the last six months, I think it has experienced such a large jump because investors have become optimistic about the positive impacts of China’s COVID-19 reopening.

Yet the demand for iron can be cyclical. I think, at some point, there will be another lull and this could lead to a lower price for iron — and BHP.

As a bonus, if I’m able to invest at a lower BHP share price then I’d also be getting a stronger future dividend yield as well.

Why I like BHP shares

I like that BHP is focusing on greener commodities like copper, nickel, and now potash.

Potash is seen as a greener form of fertiliser. BHP is working on the Jansen project in Canada, which could generate a high earnings before interest, tax, depreciation and amortisation (EBITDA) margin once it’s fully operational.

If the world is going to decarbonise then it needs a lot more copper, nickel, and so on. BHP’s scale gives it the potential to be a very low-cost producer and earn high margins.

I like that BHP has committed to a relatively high dividend payout ratio, which should mean solid cash returns each year, even if the share price is volatile.

If I can buy BHP shares at a good share price, then I’ll be able to buy at a level that gives me a good margin of safety.

What price am I looking for? Certainly under $40, perhaps under $37.50. I don’t mind if it takes months or even a few years for that price to come along – patience is important when it comes to investing in ASX shares, in my opinion.

The post Why I don’t own BHP shares (yet) appeared first on The Motley Fool Australia.

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More reading

• Have BHP shares always paid better dividends than Rio Tinto?
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares today
• BHP share price on track for biggest daily gain in almost four months
• ASX shares declared a record $98b of dividends last year. Do you own the market’s biggest payer?

Motley Fool contributor Tristan Harrison has positions in Fortescue Metals Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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 Scott Phillips.

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The Flight Centre Travel Group Ltd (ASX: FLT) share price has shot higher in 2023 – it’s up by around 30%. That’s an excellent return considering the S&P/ASX 200 Index (ASX: XJO) has only risen by 5% in 2023 so far.

The ASX travel share has done very well but, interestingly, it’s at a price that’s lower than where it was for a lot of the first half of 2022.

Maybe investors were too optimistic too early last year, but now the share price is reflecting the positive situation.

A couple of weeks ago, the business revealed a number of positives in its FY23 half-year result.

Earnings recap

Flight Centre said that in the first six months of the financial year, it generated $95 million of underlying earnings before interest, tax, depreciation and amortisation (EBITDA). This was 19% higher than the mid-point of its initial first-half target of between $70 million to $90 million while being in line with its upgraded guidance.

That means it was almost a $280 million turnaround from the FY22 first-half loss.

The ASX travel share said that it was profitable in the corporate and leisure divisions, and profitable in nearly all regions except Asia where it was breakeven.

Flight Centre said its total transaction value (TTV) was $9.9 billion and was 80% of its record FY20 half-year result. The corporate business is delivering “record TTV and set to top $10 billion during FY23”.

The company said there are positive margin trends as the company targets a 2% underlying profit before tax (PBT) margin by the end of FY25. It noted a record low underlying cost margin (of under 10%), while the revenue margin is trending “upwards”.

FY23 guidance

Reassuringly, Flight Centre reaffirmed its FY23 guidance with no signs of a slowdown in the early part of the FY23 second half. Guidance can have a notable impact on the Flight Centre share price if it wasn’t what the market was expecting.

Excluding the acquired Scott Dunn, Flight Centre is targeting $250 million to $280 million of underlying FY23 EBITDA.

January 2023 saw a post-pandemic record for monthly TTV and profit in leisure. There was also an acceleration of corporate activity from mid-January. China is seeing a “solid rebound” after the COVID reopening.

Is the Flight Centre share price a buy?

The ASX travel share is now seemingly firing on all cylinders and it’s benefiting from the strong demand.

Analyst estimates suggest that profit will return to normal in FY24 and FY25. Current Commsec projections are for earnings per share (EPS) of $1.01 in FY24 and $1.24 in FY25.

That puts the current Flight Centre share price at 19 times FY24’s estimated earnings and 15 times FY25’s estimated earnings.

In FY25, the dividend could normalise with a possible payment of 64 cents, which would be a grossed-up dividend yield of 4.9%.

I think that Flight Centre shares could rise more during 2023. However, investors are now expecting a strong profit rebound. Flight Centre would need to positively surprise investors even further to outperform, in my opinion.

I wouldn’t be rushing to try to buy at this price, but I think the company has a promising future and may be one of the few ASX 200 shares to report profit growth in both FY23 and FY24 amid wider economic uncertainty.

The post Should I buy Flight Centre shares at $19? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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At the start of each week, I like to look at ASIC’s short position report to find out which shares are being targeted by short sellers.

This is because I believe it is well worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn’t quite right with a company.

With that in mind, here are the 10 most shorted shares on the ASX this week according to ASIC:

• Flight Centre Travel Group Ltd (ASX: FLT) has returned to the top of the chart after its short interest rose to 12%. Short sellers don’t appear to be giving up on Flight Centre despite its return to form in FY 2023. Revenue margin headwinds may be a cause for concern.
• Betmakers Technology Group Ltd (ASX: BET) has seen its short interest ease slightly to 11.6%. Competition and cash burn concerns could be weighing on this betting technology company’s shares.
• Sayona Mining Ltd (ASX: SYA) has 10.7% of its shares held short, which is flat week on week. There are fears that lithium prices have now peaked and are about to decline materially.
• Core Lithium Ltd (ASX: CXO) has short interest of 10.1%, which is up week on week. As with Sayona Mining, continued weakness in spot lithium prices appear to have spooked investors.
• Megaport Ltd (ASX: MP1) has seen its short interest fall again to 9.3%. Short sellers have been targeting this network as a service provider after it reported softening operating trends with its results.
• Zip Co Ltd (ASX: ZIP) has short interest of 9.1%, which is up strongly week on week. Short sellers appear to be doubting this buy now pay later provider’s ability to achieve its profitability goals.
• Liontown Resources Ltd (ASX: LTR) has short interest of 8.1%, which is up week on week. Concerns over material cost blow outs at the Kathleen Valley Lithium Project have been weighing on sentiment.
• City Chic Collective Ltd (ASX: CCX) has jumped into the top ten with short interest of 7.3%. This plus sized fashion retailer’s abject performance and inventory management are likely to be behind this short interest.
• Lake Resources N.L. (ASX: LKE) has 6.9 % of its shares held short, which is flat week on week. Doubts over this lithium developer’s technology and project funding are reasons why one short seller is targeting Lake.
• Vulcan Energy Resources Ltd (ASX: VUL) has short interest of 6.8%, which is down slightly week on week. This also appears to be down to lithium prices being tipped to fall materially in the next 18 months.

The post Here are the 10 most shorted ASX shares this week appeared first on The Motley Fool Australia.

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More reading

• Buy this punished ASX 200 tech stock when it’s forced into a capital raise: expert
• Zip share price gains amid global asset sale
• Here are the top 10 ASX 200 shares today
• Why is the Liontown share price roaring 12% higher today?
• Here are the 3 most heavily traded ASX 200 shares on Friday

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Betmakers Technology Group, Megaport, and Zip Co. The Motley Fool Australia has recommended Betmakers Technology Group, Flight Centre Travel Group, and Megaport. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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