One earnings short-squeeze idea is Comtech Telecomm (CMTL - Get Report), which is set to release numbers on Wednesday after the market close. Comtech designs, develops, produces and markets products, systems and services for communications solutions. Wall Street analysts, on average, expect Comtech Telecomm to report revenue of $109.08 million on earnings of 38 cents per share.
The current short interest as a percentage of the float for Comtech Telecomm is notable at 7.9%. That means that out of the 17.34 million shares in the tradable float, 1.37 million shares are sold short by the bears. This is a decent short interest on a stock with relatively low float. Any bullish earnings news could easily spark a solid short-squeeze post-earnings.From a technical perspective, CMTL is currently trading above its 50-day moving average and below its 200-day moving average, which is neutral trendwise. This stock has been trading inside of a sideways trading pattern for the last month and a half, with shares moving between $27.62 on the downside and $29.25 on the upside. A move outside of that range post-earnings will likely setup this stock for its next major trend. If you're bullish on CMTL, then I would wait until after its report and look for long-biased trades if this stock can manage to break out above some near-term overhead resistance at $29.25 a share, and then its 200-day moving average of $29.88 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 89,014 shares. If that breakout triggers for CMTL, then this stock will have a great chance to re-test or possibly take out its next major overhead resistance levels at $31.05 to $31.89 a share. I would avoid CMTL or look for short-biased trades if after earnings it fails to trigger that breakout, and then moves back below some key near-term support levels at $28.14 to $27.62 a share with heavy volume. If we get that action, then CMTL will setup to re-test or possibly take out its next major support level at $26.27 a share.
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