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

5 Stocks Set to Soar on Bullish Earnings

PetSmart

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

Get Adobe Flash player

Another potential earnings short-squeeze trade idea is PetSmart (PETM), which is set to report results on Tuesday after the market close. This company is a specialty provider of products, services and solutions for the lifetime needs of pets. Wall Street analysts, on average, expect PetSmart to report revenue of $1.60 billion on earnings of 73 cents per share.

Last quarter, PetSmart beat estimates by one cent, coming in at a profit of 91 cents a share versus the estimate of 90 cents per share. This marked the fourth straight quarter of beating Wall Street estimates. This company is hoping to register its fourth straight quarter of income increases when it reports this week. Net income jumped 26.4% in the second quarter or the last fiscal year and 23.1% in the third quarter of the last fiscal year.

The current short interest as a percentage of the float for PetSmart stands at 3.6%. That means that out of the 101.80 million shares in the tradable float, 3.88 million shares are sold short by the bears. This isn't a huge short interest, but it's more than enough to spark a sizeable short-squeeze if PetSmart can manage to beat earnings and raise forward guidance.

>>5 Rocket Stocks Ready to Blast Off

From a technical perspective, PETM is currently trading below its 50-day moving average and above its 200-day moving average, which is neutral trendwise. This stock has been uptrending strong for the past six months, with shares soaring from a low of $45.16 to a recent high of $59.36 a share. This stock has recently slipped back below its 50-day moving average of $57.08 a share on heavy volume.

If you're bullish on PETM, I would wait until after it releases earnings and target long-biased trades if this stock can manage to move back above its 50-day moving average of $57.08 a share with high volume. Look for volume on that move that's close to or well above its three-month average volume of 980,090 shares. If we get that action, then I would look to add to any long positions if PETM can manage to print a new 52-week high above $59.36 a share with high-volume.

I would simply avoid PETM or look for short-biased trades if after earnings PETM fails to get back above its 50-day, and then drops below some near-term support at $54.07 to $53.17 a share with high-volume. If we get that action, then PETM could easily drop back towards its 200-day moving average of $50.17 a share if the bears hammer this stock down post-earnings.

3 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr 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

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
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!
SYM TRADE IT LAST %CHG
AZO $692.93 1.58%
DSW $36.50 -1.03%
FDO $79.27 0.04%
QIHU $50.95 -0.49%
PETM $82.98 0.04%

Markets

DOW 17,698.18 -77.94 -0.44%
S&P 500 2,059.69 -8.20 -0.40%
NASDAQ 4,880.2280 -20.6570 -0.42%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs