The once high-flying America Online, now AOL (AOL - Get Report) trades with a trailing 12 months of price-to-earnings ratio of over 200 and a forward ratio of 40. Institutions own nearly all the shares and could be the most influential additive to a short squeeze mixture.
- AOL reports before the opening bell on Wednesday.
- When institutions own enough shares, they may seriously affect the available float that makes it a lot easier for a squeeze to occur. More than 12 million shares from a float of 87.7 million shares are short.
- AOL appears to be "so yesterday" in the online world, but making money never goes out of style. Estimates are for AOL to report about 0.08 cents.
Semiconductor maker MEMC Electronic Materials (WFR) rounds out the last technology short squeeze candidate stock. MEMC reports after the close on Wednesday. Wall Street is expecting about -0.15 cents, with many experts predicting -0.18 cents or -0.19 cents.
- Analysts are expecting MEMC to move from losing money to making money. The forward price-to-earnings ratio is only 5.7, but don't give this ratio too much weight before it stabilizes.
- Almost 13% of the float is short for a record number of shares shorted at 26.3 million.
- Even with more than 7 million shares a day traded, the short interest amounts to 3.7 days of volume.
Finding stocks that may move higher due to a short squeeze can be financially rewarding and also satisfying -- you know you outsmarted the "smart money." When you do find one, it's OK to brag a little about it. Don't worry, I won't tell anyone.