This Day On The Street
Continue to site
ADVERTISEMENT
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

4 Short Covered Stocks Reporting This Week With History Of Upside

By Rebecca Lipman, Kapitall Editor  When short sellers "cover" their position on a stock they signal optimism, meaning they believe the stock has more upside (price increase) than downside ahead. This information is valuable all year long, but it is especially interesting around earnings season. (Related List:  Warning: 6 Stocks Reporting Earnings This Week With History of Disappointment)

When stocks report earnings they have the chance to surprise investors, in a good way or bad, by presenting numbers that either beat or fall below expectations. This is known as an "earnings surprise" and it has the potential to cause significant shifts in stock prices. 

We had an idea: Let's take a look at stocks reporting earnings this week (February 26-29) with two bullish signals:

1) Significant short covering - shares shorted have decreased month over month. Again, this is a sign that short sellers, who benefit when share prices fall, think these stocks will increase in value

2) A history of positive earning surprises - We looked for stocks that have reported at least an average 5% above estimated EPS over the past 5 quarters. Past performance is no guarantee of the future, but this might imply the market is continually undervaluing these stocks.  

We were left with 4 names. What do you think is in store for these names? Use this as a starting point for your own analysis.  List Average 1-Year Return: -11%

1. BroadSoft, Inc. ( BSFT): Provides software that enables fixed-line, mobile, and cable service providers to deliver voice and multimedia services over Internet protocol (IP) based networks. Market cap at $913.5M, most recent closing price at $33.11.

Shares shorted have decreased from 4.42M to 3.97M over the last month, a decrease which represents about 1.64% of the company's float of 27.48M shares. Days to cover ratio at 9.4 days.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr 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

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
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!
SYM TRADE IT LAST %CHG

Markets

DOW 18,034.93 +208.63 1.17%
S&P 500 2,100.40 +19.22 0.92%
NASDAQ 4,994.6020 +62.7870 1.27%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs