This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
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
TheStreet Open House

5 Earnings Stocks Poised to Pop

Stocks in this article: SABAXRTXJOSBWORBBY

Best Buy

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

Get Adobe Flash player

Another earnings short-squeeze candidate is Best Buy (BBY), which is set to release numbers on Thursday before the market opens. This company is a multinational retailer of consumer electronics, home office products, entertainment products, appliances and related services. Wall Street analysts, on average, expect Best Buy to report revenue of $17.22 billion on earnings of $2.16 per share.

During the last quarter, Best Buy missed Wall Street estimates by 4 cents after reporting a profit of 47 cents per share. The company also missed Wall Street estimates for its second quarter earnings report. On a positive note, Best Buy could produce its third-straight quarter of revenue increased on the top line. This stock is up over 15% in 2012 as we move closer to its earnings report.

The current short interest as a percentage of the float for Best Buy is very high at 17.1%. That means that out of the 279.59 million shares in the tradable float, 47.84 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 6.8%, or by about 3.05 million shares.

From a technical perspective, BBY is currently trading above both its 50-day and 200-day moving averages, which is bullish. This stock has seen buying interest during the last few months at around $22.30 to $23.40 a share. On the flipside, shares of BBY have run into selling resistance at around $28.22 to $28 a share.

If you're bullish on BBY, I would wait until after it reports earnings and only look for long-biased trades if it breaks out above some overhead resistance at $28.33 to $29.50 a share with high-volume. Look for volume on that move that's near or well above its three-month average volume of 5.5 million shares. If we get that action, I would look for BBY to make a run at its 52-week high of $32.85 if the bulls push this higher post-earnings.

I would simply avoid BBY or look for short-biased trades if it fails to break out post-earnings above some near-term overhead resistance at $28 a share, and then sells off with heavy volume through its 200-day moving average of $25.94 and 50-day of $25.24. If we get that action, look for BBY to drop back towards $23 to $22 a share if the bears drill this stock.

Best Buy, one of the Greenlight Capital's holdings, shows up on a recent list of 3 Shorted Stocks Too Cheap to Sell.

3 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link 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

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, 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
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,750.50 +289.18 1.76%
S&P 500 1,958.16 +31.05 1.61%
NASDAQ 4,467.1540 +84.3070 1.92%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs