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Another earnings short-squeeze candidate is online marketplace for the vacation rental industry
HomeAway(AWAY - Get Report), which is set to release numbers on Wednesday after the market close. Wall Street analysts, on average, expect HomeAway to report revenue of $70.87 million on earnings of 13 cents per share.
If you're looking for a heavily shorted stock that's been uptrending strong heading into its quarterly report this week, then make sure to check out shares of HomeAway. This stock is up 18.9% during the last three month, and it's currently trading just three points off its 52-week high of $27.47 a share.
The current short interest as a percentage of the float for HomeAway is extremely high at 26.7%. That means that out of the 43.72 million shares in the tradable float, 11.72 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 4%, or by 453,000 shares. If the short-sellers are caught being too aggressive into a strong quarter, then shares of AWAY could easily skyrocket higher post-earnings.
From a technical perspective, AWAY is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending strong for the last three months, with shares soaring higher from its low of $19.58 to its recent high of $25.56 a share. During that uptrend, shares of AWAY have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of AWAY within range of triggering a major breakout trade post-earnings.
If you're bullish on AWAY, 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 $25.56 to $26.28 a share and then once it clears more resistance at $27.47 to $28 a share with high volume. Look for volume on that move that hits near or above its three-month average volume of 533,653 shares. If that breakout triggers, then AWAY will set up to enter new 52-week high-territory, which is bullish price action. Some possible upside targets off that breakout are $34 to $38 a share.
I would avoid AWAY or look for short-biased trades if after earnings it fails to trigger that breakout, and then drops back below some near-term support at $24 a share with high volume. If we get that move, then AWAY will set up to re-test or possibly take out its 200-day at $23.14 or its 50-day at $22.66 a share. Any high-volume move below those levels will then put $21.35 to $20.92 into range for shares of AWAY.