Odds are stacked against shorts targeting Well Health Technologies

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Sat, 07/20/2019 - 11:23 am Ted Dixon, Canadian Insider

While the short positioning in Paramount Resources (Mixed; POU) remains off its peak seen in mid-May, short bets against the stock remain highly elevated. The stock has recently pulled back from a rally off its June lows and short sellers seem generally content to hold on to their bets for a stock breakdown.

A notable change in our Top 10 most shorted list this week is the disappearance of Stingray Group (Mixed; RAY) due to an increase in the stock's estimated float. That paved the way for Laurentian Bank (Mixed: LB) which takes the 10th spot. Based on our signals, the shorts may be on to something there. In terms of signals, Cargojet (Mixed; CJT) has flipped back to a bearish setup.

Top 10 Canadian Stocks Shorted as of July 15, 2019*
    Stock Shares Short %Float Change INK Signal
1 POU Paramount Resources 7,077,862 25.07% -1.12% Squeeze
2 HLF High Liner Foods 3,575,756 17.36% -0.50% Bearish
3 GWO Great West Lifeco 27,858,423 12.78% -0.23% Squeeze
4 CJT Cargojet 1,471,122 12.12% 0.56% Bearish
5 ACQ AutoCanada 3,125,295 10.79% 0.91% Bearish
6 SSL Sandstorm Gold 19,358,132 10.98% 0.40% Bearish
7 BNE Bonterra Energy 2,035,029 9.83% 0.58% Squeeze
8 NOA North American Constr. 2,412,757 9.81% 0.28% Bearish
9 CHW Chesswood Group 847,616 9.47% 0.02% Bearish
10 LB Laurentian Bank 3,688,475 8.72% 0.01% Bearish

*Stocks trading above $1

Some notable changes in short positions with bearish setups based on our signals include uranium junior Energy Fuels (Cloudy; EFR) which saw shorts jump 2.06% to 3.56% of float. Acasti Pharma (Mixed; ACST) saw its short position jump 1.34% to 2.53% while shorts boosted their positioning in Endeavour Silver (Cloudy; EDR) by 1.01% fo 3.15% of float.

Bullish developments took place in a number of stocks including Burcon Nutrascience (Sunny; BU) as shorts dropped 2.94% to 0.66% of float as the company's recent rights offering moves further down the rear-view mirror. InterRent REIT (Mostly Sunny; IIP) saw short interest fall 1.58% to 0.52% following the closing of a recent financing while high-flying Well Health Technologies (Sunny; WELL) saw short positions jump 2.40% to 2.45% of float as shorts take on a stock the a high amount of insider commitment. On average, when it comes to a battle between the shorts and insiders with skin-in-the-game, we would put our money on the insiders.

This article first appeared on INKResearch.com.

Disclosure: I hold shares of BU.

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