My first earnings short-squeeze idea today is organic light-emitting diode technology developer Universal Display (PANL), which is set to report its numbers on Tuesday after the market close. Wall Street analysts, on average, expect Universal Display to report revenue of $12.41 million on a loss of 1 cent per share.
This stock is trading down sharply today by over 10% to $46.55 as we quickly approach its earnings report. This near-term volatility only raises the chances of a big earnings move; the stock also soared on Friday from under $45 a share to close to $53.The current short interest as a percentage of the float for Universal Display is rather large at 16.2%. That means that out of the 31.52 million shares in the tradable float, 6.39 million are sold short by the bears. From a technical standpoint, this stock is currently trading above its 200-day moving average and below its 50-day moving average, which is neutral trendwise. This stock recently hit a high of $60.28 in September and has since then sold off and started to trade sideways between $52.50 and around $41. A move outside of the sideways trading pattern will setup this stock for its next big trend. If you're bullish on this stock, I would look to get long after it report its results if it breaks out above $53 a share on heavy volume. Look for volume that's tracking in close to or above its three-month average action of 2.3 million shares. If we get the breakout post-earnings, then look for this stock to challenge its September high of $60.28, or possibly go much higher. I would get short Universal Display after earnings only if it drops below its 200-day moving average of $43.21 on heavy volume. I would get aggressively short if it takes out some previous support zones at $40.93 to $40.68 a share on strong volume. This stock could plunge big if those support zones are taken out, so be ready to play this short if we get that action. Scott Rothbort previously highlighted Universal Display in " 7 Top Stocks That Should Continue to Outperform."