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An earnings short-squeeze play in the construction and agriculture machinery sector is
Manitowoc Company(MTW - Get Report), which is set to release numbers on Tuesday after the market close. Wall Street analysts, on average, expect Manitowoc to report revenue of $955.71 million on earnings of 14 cents per share.
If you're looking for a stock that's been uptrending strong heading into its earnings report, then you take a strong look at shares of MTW. This stock has more than doubled off its October low of $5.71 since its current price is just over $13 a share.
The current short interest as a percentage of the float for Manitowoc is rather high at 8.1%. That means that out of the 126.77 million shares in the tradable float, 9.87 million are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 5.5%, or by about 516,000 shares.
From a technical standpoint, MTW is currently trading above its 50-day and 200-day moving averages, which is bullish. This stock has run up big off its October low of $5.71 a share, and now it sets up for a major breakout trade if the company can report results that the bulls' love.
If you're bullish on MTW, I would wait until after they report their earnings and buy some shares if it can manage to break out above $13.72 a share on high-volume. Look for volume that's tracking in close to or above its three-month average volume of 3.4 million shares. If we get that action, then look for MTW to pop 10% or more post-earnings.
I would avoid MTW or get short this stock if after it report its results the stock fails to break out and drops back below its 200-day moving average of $12.75 with volume. I would then add to any short positions once MTW takes out some near-term support at $12.38 with volume. Target a drop back towards its 50-day moving average of $10.48 a share, or much lower if the bears whack this lower post-earnings.
Manitowoc shows up on a December list of
8 Stocks With Biggest Upside in Market Rebound.