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
TheStreet Open House

5 Hated Stocks Set to Soar on Earnings

Stocks in this article: TRIPSTMPZLGNDGNC

Ligand Pharmaceuticals

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

Get Adobe Flash player

Another earnings short-squeeze play is biotechnology and drugs player Ligand Pharmaceuticals (LGND), which is set to release numbers on Wednesday after the market close. Wall Street analysts, on average, expect Ligand Pharmaceuticals to report revenue of $13.27 million on earnings of 21 cents per share.

>>5 Rocket Stocks Ready for Blastoff This Week

If you're looking for a stock with a decent short interest that's trending strong heading into its earnings report, then make sure to take a hard look at shares of Ligand Pharmaceuticals. This stock has traded up 25% during the last three months, and it's currently trading just 2 points off its 52-week high of $21.75 a share.

The current short interest as a percentage of the float for Ligand Pharmaceuticals is notable at 7.4%. That means that out of the 12.49 million shares in the tradable float, 1.46 million shares are sold short by the bears. Any bullish earnings news could easily spark short-squeeze for shares of LGND post-earnings.

From a technical perspective, LGND is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been trending sideways for the last month and change, with shares moving between $18.42 on the downside and 21.75 on the upside. A high-volume move above the upper-end of its recent range will triggering a breakout trade for shares of LGND post-earnings.

If you're bullish on LGND, then I would wait until after its report and look for long-biased trades if this stock manages to break out above some near-term overhead resistance levels at $20.98 to $20.99 a share and then once it clears more resistance at $21.75 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 150,774 shares. If that breakout triggers, then LGND will set up to enter new 52-week high territory above $21.75 a share, which is bullish technical price action. Some possible upside targets off that breakout are $25 to $28 a share.

I would avoid LGND or look for short-biased trades if after earnings it fails to trigger that breakout, and then drops back below its 50-day moving average of $20.08 a share with high volume. If we get that move, then LGND will set up to re-test or possibly take out its next major support levels at $19.35 to $19.03 a share. Any high-volume move below those levels will then put $18.42 to $17.69 into range for shares of LGND.

5 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

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
Stocks Under $10

Jim Cramer's protégé, 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
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, 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
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
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.
Submit an article to us!
DOW 16,502.15 +102.48 0.62%
S&P 500 1,925.23 +21.22 1.11%
NASDAQ 4,377.8870 +61.8130 1.43%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

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