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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

5 Stocks Poised to Pop on Positive Earnings

RealD

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

Get Adobe Flash player

Another potential earnings short-squeeze trade is 3D motion picture technology player RealD (RLD), which is set to report results on Wednesday after the market close. This company is a global licensor of 3D technologies. This company licenses its RealD Cinema Systems to motion picture exhibitors that show 3D motion pictures and alternative 3D content. Wall Street analysts, on average, expect RealD to report revenue of $46.98 million on a loss of 7 cents per share.

This company has topped Wall Street estimates for the last four quarters and its coming off a quarter where it beat estimates by 11 cents, after reporting a profit of 5 cents per share vs. forecasts of a net loss of 6 cents per share. During the third quarter, RealD swung to a profit of $2.8 million or 5 cents per share vs. a loss of $16.6 million or 34 cents per share from a year earlier. Revenue dropped 15.2% to $49 million from $57.8 million in the same quarter a year ago.

The current short interest as a percentage of the float for RealD is pretty high at 12.2%. That means that out of the 43.96 million shares in the tradable float, 5.31 million shares are sold short by the bears. This is more than enough shorts on a stock with a reasonably low float to spark a sizeable short-squeeze post-earnings, if RealD can deliver the numbers the bulls are looking for.

>>5 Stocks to Buy Instead of Dell

From a technical perspective, RLD is currently trading above its 200-day moving average, and just a few cents below its 50-day moving average, which is neutral trendwise. This stock recently bounced hard off its 200-day moving average of $11.05 with above average volume. That bounce has now pushed RLD within range of triggering a major breakout trade post-earnings.

If you're bullish on RLD, I would wait until after it releases earnings and look for long-biased trades if this stock can trigger a break out above its 50-day moving average of $11.94, and then above some near-term overhead resistance at $12.20 to $12.59 a share with high-volume. Look for volume on that move that hits close to or above its three-month average volume of 389,533 shares. If we get that action, then look for RLD to re-test and potentially take out its March high of $13.55 a share.

I would simply avoid RLD or look for short-biased trades if after earnings it fails to sustain a trend back above its 50-day at $11.94, and then drops below some major near-term support at $10.61 a share with high-volume. If we get that action, then RLD could easily drop down towards $9.50 to $8 a share if the bears spark a large selloff post-earnings.

3 of 6

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
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 17,051.73 -48.45 -0.28%
S&P 500 1,973.63 -4.59 -0.23%
NASDAQ 4,424.7040 -7.4420 -0.17%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

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