Outwit the S&P in 2013 With 5 Hated Stocks

That said, it's clear that shorts are betting against the premium price tag that this stock currently sports. ISRG is unquestionably a growth stock, and metrics like its P/E ratio prove it. While value investors aren't jumping onboard ISRG right now, it's hard to argue with the sales and profit growth trajectory that this stock has been moving along for the last several years -- and a debt-free balance sheet with more than $2 billion in cash and investments helps temper the loftiness of Intuitive's valuation. Earnings next month could be a short squeeze catalyst for this stock.

Digital Realty Trust

Technology real estate investment trust Digital Realty Trust (DLR) rounds out our list today. This niche REIT owns more than 100 properties around the globe, focused mainly datacenters, internet gateways, corporate HQs, and manufacturing facilities. The firm currently sports a short interest ratio of 11.1.

DLR's niche real estate portfolio is the biggest reason behind this stock's attractiveness. Demand for internet datacenters and gateways is growing fast thanks to data-driven services (like cloud storage), boosting DLR's market for tenants. As long as firms need more virtual space to store data, they'll also need more physical space to store servers; that's space that DLR is uniquely qualified to provide. Because tenants' properties are effectively built to suit their specific technical needs, switching costs are very high, and DLR's renewal rates are stellar.

Income investors love this stock right now, even if everyone else doesn't. That's because this REIT is essentially a purpose-built income generation tool. Digital Realty enters into long-term triple-net leases with tenants, an arrangement that takes most of the risks off of DLR's balance sheet and puts the onus on tenants instead. The result is a predictable income stream and a hefty 4.3% dividend yield right now. That, coupled with a high short interest ratio, make DLR a solid short squeeze candidate going into 2013.

To see this week's short squeezes in action, check out the of Large-Cap Short Squeezes portfolio on Stockpickr.

At the time of publication, author had no positions in stocks mentioned.

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Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on CNBC.com. Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.

Jonas Elmerraji is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.

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