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One more earnings short-squeeze candidate to keep on your radar is
Quiksilver(ZQK), which is set to release numbers on Thursday after the market close. This is a diversified company that designs, develops and distributes branded apparel, footwear, accessories and related products, catering to the casual, youth lifestyle associated with the sports of surfing, skateboarding and snowboarding. Wall Street analysts, on average, expect this company to report revenue of $471.74 million on earnings of 7 cents per share.
Quiksilver sells into an interesting niche market but has fallen on hard times as its leading brands struggle to gain any traction domestically. That said, there's some buzz going around about its new women's clothing line that could generate some excitement back into the stock. Quiksilver has also recently extended sponsorship agreements with two very popular surfers that are world renowned. These deals will help to push their brand name around the globe, and potentially boast sales, since sports fans love to buy the gear of their favorite athletes.
The current short interest as a percentage of the float for Quiksilver is 5.9%, which means that out of the 118.44 million shares in the tradable float, 6.77 million are sold short by the bears. The short-sellers have also been increasing their best from the last reporting period by around 7.9%, or by about 496,000 shares.
From a technical standpoint, this stock just started to move above both its 50-day and 200-day
moving averages on solid volume. Upside volume for the last two trading sessions has clocked in at 1.6 and 1.3 million versus the three-month average volume of around 1 million shares. It's also worth noting that the stock has a ton of support at around $4 a share, so it's possible it has put in a bottom if it can hold that level.
One way to play this stock is to buy it as soon as it breaks out above some past overhead
resistance at around $4.93 a share. We could easily see a run toward $5.50 to $5.70 a share, which are the next significant overhead resistance levels. The chances for a big pop here following earnings look pretty good, so keep this on your radar.
To see more potential earnings short squeeze candidates, including
China Medical Technologies(CMED) and
A-Power Energy Generation Systems(APWR), check out the
Earnings Short Squeeze Plays portfolio on Stockpickr.
-- Written by Roberto Pedone in Winderemere, Fla.