Five widely followed TSX stocks currently have approximately 66 million shares sold short between them. That’s a costly way for bearish investors to say they expect trouble. It’s also a warning that long-term shareholders shouldn’t dismiss simply because pessimism is terribly unfashionable during a rising market.
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What’s short selling?
A short-seller borrows shares, sells them, and hopes to repurchase them at a lower price. The profit is limited because a stock can only fall to zero, while losses can theoretically keep climbing with the share price. That ugly equation gives short sellers a powerful reason to research what could go wrong.
Still, short interest isn’t a guilty verdict. Positions may hedge another investment, and even an excellent bearish thesis can lose money when timing misbehaves. The Canadian Investment Regulatory Organization report, dated July 15, reveals five particularly interesting battlegrounds.
| STOCK | SHARES SHORT | CHANGE FROM JUNE 30 | APPROX. % OF SHARES |
|---|---|---|---|
| AQN | 23.45 million | +16.0% | 3.1% |
| WEED | 16.76 million | +1.5% | 4.0% |
| NPI | 9.95 million | +29.3% | 3.8% |
| CGX | 8.68 million | -3.7% | 13.8% |
| MDA | 7.15 million | +117.4% | 5.2% |
AQN
Algonquin Power & Utilities (TSX: AQN) has sold most of its renewable-energy business and returned to regulated utilities. Shorts see a company that has already cut its dividend and still reported a 7% decline in first-quarter adjusted earnings per share.
Rate decisions can support future revenue, although debt, capital spending, and another earnings disappointment could keep this turnaround stuck in the waiting room.
WEED
Canopy Growth (TSX: WEED) increased fiscal 2026 revenue by 6%, yet still lost $20.2 million in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) and burned $69.1 million in free cash flow.
The share count also more than doubled year over year. Medical cannabis growth could improve the story, but shorts see dilution doing push-ups while profitability remains winded.
NPI
Northland Power (TSX: NPI) is building the 1.1-gigawatt (GW) Baltic Power and 1.0-GW Hai Long offshore wind farms. First-quarter adjusted EBITDA rose 18%, and Baltic recently produced its first electricity.
Shorts are staring at construction, financing, currency, and delay risks before both projects fully contribute cash. Successful completion could turn today’s concern into the fuel for a squeeze.
CGX
Cineplex (TSX: CGX) has the largest short position relative to its share count. Bears see $746 million in long-term debt, fickle movie schedules, and first-quarter adjusted free cash outflow of $8.8 million.
The counterargument is arriving on screen. First-quarter revenue rose 15.6%, while second-quarter box-office revenue increased 11%. Continued recovery could make covering 8.68 million borrowed shares decidedly uncomfortable.
MDA
MDA Space (TSX: MDA) produced 32% first-quarter revenue growth and held a $3.7 billion backlog. Those are outstanding numbers for one of Canada’s most exciting growth stocks.
Shorts instead see a backlog down from $4.8 billion, negative quarterly free cash flow, a lofty earnings valuation, and execution risk from its planned Blue Canyon acquisition. The business can succeed while an impatient share price still falls.
Bottom line
I wouldn’t buy any of these companies merely because a squeeze sounds fun. Canopy remains highly speculative, while Algonquin and Northland must prove their resets can produce durable cash. Cineplex and MDA offer stronger operating momentum, although neither belongs in the bargain bin automatically.
Investors searching for Canadian value stocks should use short interest as a research list, then let future cash flow decide whether the bears spotted a crack or simply stood on the wrong side of the next rally.
