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
See Cramer's multi-million dollar portfolio for FREE and get his new book Get Rich Carefully! Learn More

5 Stocks Set to Soar on Bullish Earnings

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), 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.

Stock quotes in this article: ACTG, CBST, GHL, ATHN, LTM 

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.
DOW 16,501.65 -12.72 -0.08%
S&P 500 1,875.39 -4.16 -0.22%
NASDAQ 4,126.9670 -34.4910 -0.83%

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