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One potential earnings short-squeeze candidate in the medical equipment and supplies sector is
Bacterin International(BONE), which is set to report results on Thursday after the market close. This company develops, manufactures and markets biologics products to domestic and international markets through Bacterin's biologics division. Wall Street analysts, on average, expect Bacterin International to report revenue of $9.50 million on a loss of 3 cents per share.
If you're looking for a small-cap stock that's trading within range of triggering a big breakout post-earnings, then make sure to check out shares of Bacterin International. During the last six months, this stock has been on fire rising over 70%.
The current short interest as a percentage of the float for Bacterin International sits at 4.2%. That means that out of the 22.55 million shares in the tradable float, 992,694 shares are sold short by the bears. This isn't a huge short interest, but the float is small so any bullish earnings news could easily spark a big short-squeeze for BONE.
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From a technical perspective, BONE is currently trading above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending strong for the past number of months, rising from $1.73 to its recent high of $3.54 a share. During that uptrend, shares of BONE have consistently made higher lows and higher highs, which is bullish price action. Now the stock is trading within range of triggering a near-term breakout trade.
If you're bullish on BONE, I would wait until after its report and look for long-biased trades if the stock breaks out above some near-term overhead resistance at $3.54 a share with high-volume. Look for volume on that move that's near or well above its three-month average volume of 259,102 shares. If we get that action, then look for BONE to make a run at its November high of $3.93 a share, or possibly towards $4.50 to $4.90 a share, which are past overhead resistance levels.
I would avoid long-biased trades in BONE if this stock fails to break out over $3.65 a share with volume post-earnings. A failure to
trigger that breakout could set this stock up to re-test its 50-day moving average of $2.87 or possibly fall lower if the bears slam this stock post-earnings.