My first earnings short-squeeze play today is computer hardware player Dell (DELL), which is set to report results on Tuesday market the market close. Wall Street analysts, on average, expect Dell to report revenue of $14.66 billion on earnings of 34 cents per share.
During the last quarter, this company missed Wall Street estimates by 3 cents per share, after reporting a net income of 43 cents per share vs. estimates of 46 cents per share. Dell fell in line with Wall Street expectations in the fourth quarter of the last fiscal year.The current short interest as a percentage of the float for Dell is notable at 3%. That means that out of the 1.47 billion shares in the tradable float, 44.03 million shares are sold short by the bears. This isn't a huge short interest, but it's a ton of total shares sold short by the bears. If DELL can give the bulls what they're looking for, then we could see a solid short squeeze develop post-earnings. >>4 Tech Stocks to Trade (or Not) From a technical perspective, DELL is currently trading above its 50-day moving average and below its 200-day moving average, which is neutral trendwise. This stock gapped down in May from over $15 to $12.31 a share on heavy volume. Following that gap down, shares of DELL have trended sideways between $11.40 and $12.73 a share. A move outside of that sideways trading pattern post-earnings will likely setup the next major trend for DELL. If you're bullish on DELL, 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 $12.44 to $12.73 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 20,355,900 shares. If we get that action, then DELL will have a great chance of re-filling some of that previous gap and heading towards $15 a share or higher. I would simply avoid DELL or look for short-biased trades if after earnings it fails to trigger that breakout, and then drops below some near-term support at $12 a share with heavy volume. If we get that move, then DELL will setup to re-test and possibly take out some major support levels at $11.39 to $11.34 a share. Dell was included on a recent list of 10 Profitable and Oversold Stocks Ready to Move Higher.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
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.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
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.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV