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

5 Stocks Set to Soar on Bullish Earnings

Stocks in this article: ACTG CBST GHL ATHN LTM

Acacia Research

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

Get Adobe Flash player

My first earnings short-squeeze trade idea is patent player Acacia Research (ACTG - Get Report), which is set to report results on Thursday after the market close. This company, through its operating subsidiaries, acquires, develops, licenses and enforces patented technologies. It generates revenue and related cash flow from the granting of rights for the use of patented technologies. Wall Street analysts, on average, expect Acacia Research to report revenue of $42.24 million on earnings of 24 cents per share.

If you're looking for an uptrending heavily shorted stock that the bears are pressing their bets with ahead of the quarter, then make sure to check out shares of Acacia Research. This stock hit a near-term low of $32.44 in June and has since then run up to its current price of $39 a share.

The current short interest as a percentage of the float for Acacia Research sits at 5.9%. That means that out of the 45.94 million shares in the tradable float, 2.85 million shares are sold short by the bears. The short-sellers have also been increasing their bets from the last reporting period by 12.4%, or by about 312,800 shares. If the bears are caught leaning too hard into this quarter, then we could easily see a big-time short-covering rally kick off post-earnings.

From a technical perspective, ACTG is currently trading above both its 50-day and 200-day moving averages, which is bullish. This stock dropped big back in May from a high of $42.42 to a recent low of $32.44 a share. During that slide lower, shares of ACTG have consistently made lower highs and lower lows, which is bearish technical price action. That said, ACTG has started to rebound of late with shares moving back above both its 50-day and 200-day moving averages. That move has pushed ACTG within range of triggering a near-term breakout trade.

If you're bullish on ACTG, then I would wait until after earnings and look for long-biased trades if this stock can manage to trigger a breakout above some near-term overhead resistance at $40.32 a share with high volume. Look for volume on that move that registers near or above its three-month average action of 374,862 shares. If we get that move, then ACTG will likely re-test and possibly take out its next major overhead resistance level of $42.43 a share. Any high-volume move over $42.43 should give ACTG a great chance of tagging $44.98 a share.

I would simply avoid ACTG or look for short-biased trades if after earnings it fails to trigger that breakout, and then drops below both its 200-day at $37.71 and its 50-day at $36.49 a share with high-volume. If we get that action, then ACTG will likely trend down towards $35 to $33 a share, or possibly even lower if the bears hammer this stock post-earnings.

As of the most recently reported quarter, ACTG was one of George Soros' top holdings.

2 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!

Markets

DOW 17,672.60 -141.38 -0.79%
S&P 500 2,051.82 -11.33 -0.55%
NASDAQ 4,757.8790 +7.4820 0.16%

Partners Compare Online Brokers

Free Reports

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