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 Poised to Pop on Bullish Earnings

Auxilium Pharmaceuticals

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

Get Adobe Flash player

One potential earnings short-squeeze trade in the biotechnology and drugs complex is Auxilium Pharmaceuticals (AUXL), which is set to release numbers on Tuesday before the market open. This company is focused on developing and marketing products to predominantly specialist audiences. Wall Street analysts, on average, expect Auxilium Pharmaceuticals to report revenue of $73.97 million on a loss of 6 cents per share.

Another strong uptrending and heavily-shorted biotechnology stock to put on your trading radar this week heading into its earnings report is shares of Auxilium Pharmaceuticals. This stock is up over 30% so far in 2012, and it's currently trading around two points off its 52-week high of $27.89 a share.

The current short interest as a percentage of the float for Auxilium Pharmaceuticals is notable at 8.6%. That means that out of the 37.69 million shares in the tradable float, 4.09 million shares are sold short by the bears. This is a decent amount of bears involved in a stock with a relatively small float. Any bullish earnings news out of Auxilium and we could easily see a solid short-squeeze develop post-earnings.

From a technical perspective, AUXL is currently trading above its 50-day and 200-day moving averages, which is bullish. This stock triggered a major breakout in June once it took out some overhead resistance at $19.63 to $21.25 a share with monster volume. Following that breakout, shares of AUXL skyrocketed to its recent 52-week high of $27.89 a share. That move has now pushed the stock within range of triggering a near-term breakout trade post-earnings.

>>Hot Biotech Stocks Traded by Hedge Funds

If you're bullish on AUXL, then I would wait until after they report and look for long-biased trades if this stock can manage to break out above some near-term overhead resistance at $26.95 to $27.25 a share, and then its 52-week high of $27.89 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 695,379 shares. If we get that move, then look for AUXL to trade north of $30 a share if the bulls gain full control of this stock post-earnings.

I would avoid AUXL or look for short-biased trades if after earnings it fails to trigger that breakout, and then drops below some major near-term support levels at $25.45 to $25.42 a share, and then its 50-day moving average of $23.94 a share with heavy volume. If we get that action, then AUXL could easily trade down towards $21 a share, or possibly lower if bears whack this stock down post-earnings.

Stock quotes in this article: THRX, CRUS, AUXL, ENTR, OCLR 

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 16,507.72 -6.65 -0.04%
S&P 500 1,875.99 -3.56 -0.19%
NASDAQ 4,129.12 -32.3380 -0.78%

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