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One potential earnings short-squeeze play in the consumer goods complex is
Annie's(BNNY), which is set to release numbers on Tuesday after the market close. This company is a natural and organic food company offering consumers products in packaged food categories. Wall Street analysts, on average, expect Annie's to report revenue of $32.21 million on earnings of 12 cents per share.
This company came public back in late March, and the stock has been trading within a huge range between $32.66 and $45 a share since its IPO. The current short interest as a percentage of the float for Annie's is very high at 15%. That means that out of the 6.2 million shares in the tradable float, 923,000 shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 42%, or by about 273,000 shares.
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From a technical perspective, BNNY is currently trading above both its 50-day moving average, which is bullish. This stock has been moving within a shorter-term range for the past month, between $44.68 on the upside and $39.07 a share on the downside. A move above the upside of that range post-earnings could setup BNNY to trade into new all-time high territory.
If you're bullish on BNNY, then I would wait until after they report earnings and look for long-biased trades if this stock can manage to trigger a break out above some near-term overhead resistance at $42.22 to $44.68 a share, and then its all-time high of $45 a share with high volume. Look for volume on that move that registers near or above its three-month average action of 183,557 shares. If we get that action, then BNNY could easily trade north of $50 a share post-earnings.
I would avoid BNNY or look for short-biased trades if it fails to trigger that breakout after earnings, and then takes out its 50-day moving average of $38.82 a share with heavy volume. If we get that move, then BNNY will like trade down towards $35 a share, or possibly lower if the bears hammer this stock post-earnings.