This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

6 Earnings Stocks That Could Crush the Shorts


Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

An earnings short-squeeze play in the communications equipment sector is Garmin (GRMN - Get Report), which is set to release numbers on Wednesday before the market opens. This is a provider of navigation, communication and information devices and applications enabled by global positioning system technology. Wall Street analysts, on average, expect Garmin to report revenue of $633.75 million on earnings of 66 cents per share.

Like Sirius, this company should also benefit from a pickup in sales in the U.S. car market from last year. Garmin beat Wall Street estimates last quarter but missed estimates in the quarter prior to that one.

The current short interest as a percentage of the float for Garmin is an extremely large 20%. That means that out of the 107.40 million shares in the tradable float, 21.46 million are sold short by the bears. The bears have also been upping their bets from the last reporting period by 6%, or by about 1.2 million shares. If the bears are caught leaning the wrong way here and Garmin posts strong numbers and guides higher, then the stock could see a decent short-covering rally.

From a technical standpoint, shares of Garmin are currently trading below both the 50-day and 200-day moving averages, which is bearish. The stock has also been making lower highs for the past couple of months, which is also bearish. That said, the stock seems to be finding some buying support at around $32 to 31.50 a share.

The way I would play Garmin is to buy this stock following its report if it trades above the 50-day moving average at $33.10 and the 200-day moving average at $32.51 on strong volume. I would add to any long positions above $34 and then $34.50 if the stock continues to rip higher post-earnings. My target would be the 52-week high at $36.42 a share.

I would only short this stock after its report if you see shares drop below $31.21 on big volume. I would add to any short position below $30 a share if the bears want to drive this stock lower.

Garmin is one of the top-yielding electronics stocks.
6 of 7

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
AREX $0.83 -6.55%
GRMN $34.47 1.53%
GMCR $89.98 0.55%
GLUU $3.02 4.67%
SIRI $3.40 1.49%


Chart of I:DJI
DOW 15,914.74 -99.64 -0.62%
S&P 500 1,851.86 -0.35 -0.02%
NASDAQ 4,283.5920 +14.8290 0.35%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs