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My final earnings short-squeeze play today is oil well services and equipment player
(CLB - Get Report), which is set to release numbers on Wednesday after the market close. This company is a Netherlands-based provider of reservoir description, production enhancement and reservoir management services to the oil and gas industry. Wall Street analysts, on average, expect Core Laboratories to report revenue of $246.66 million on earnings of $1.11 per share.
The current short interest as a percentage of the float for Core Laboratories sits at 6.1%. That means that out of the 46.43 million shares in the tradable float, 2.84 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 8.3%, or by about 216,000 shares. If the bears are caught pressing too hard here, then we could easily see a sizeable short-squeeze develop post-earnings.
From a technical perspective, CLB is currently trading below both its 50-day and 200-day moving averages, which is bearish. This stock gapped down big earlier this month from around $120 to $100 with massive volume. Following that gap, shares of CLB went on to hit a low of $98.66 a share. This stock has subsequently started to bounce a bit to its current price of $102.50 a share. That move has pushed CLB within range of triggering a breakout post-earnings back above its gap down day high of $105.08 a share.
If you're in the bull camp on CLB, then I would wait until after its earnings report and look for long-biased trades if this stock manages to break out above its gap down day high of $105.08 a share with high volume. Look for volume on that move that registers near or above its three-month average action of 433,329 shares. If we get that move, then CLB will setup to re-fill some of that gap and possible trade back towards its 50-day moving average of $118.35 a share.
I would simply avoid CLB 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 $100 to 98.66 a share with high volume. If we get that move, then CLB will setup to re-test or possibly take out its next major support levels at $93.30 to $82.74 a share.
To see more potential earnings short squeeze plays, check out the
Earnings Short Squeeze Plays portfolio on Stockpickr.
-- Written by Roberto Pedone in Winderemere, Fla.