Another earnings short-squeeze candidate is biotechnology and drugs player
(AEGR - Get Report)
, which is set to release numbers on Wednesday before the market open. There are currently no analysts' estimates available for Aegerion Pharmaceuticals on the revenue front, but the company is forecasted to post a loss of 63 cents per share.
Aegerion is another heavily shorted stock that's been uptrending crazy strong heading into its earnings report this week. This stock has exploded higher during the last six months, with shares up 117%.
The current short interest as a percentage of the float for Aegerion Pharmaceuticals is pretty high at 12.1%. That means that out of the 21.29 million shares in the tradable float, 2.73 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 10.2%, or by about 252,000 shares. If the bears are caught pressing their bets too hard into a bullish quarter, then shares of AEGR could rip significantly higher post-earnings.
From a technical perspective, AEGR is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending very strong for the last five months, with shares soaring higher from its low of $13.50 to its intraday high of $31.99 a share. During that uptrend, shares of AEGR have been consistently making higher lows and higher highs, which is bullish technical price action.
If you're bullish on AEGR, then I would wait until after its report and look for long-biased trades if this stock manages to break out to a new 52-week high with heavy upside volume. Look for volume on that move that registers near or above its three-month average action of 477,798 shares. If that breakout hits, then AEGR could possibly trend well north of $35 a share.
I would avoid AEGR or look for short-biased trades if after earnings it fails to trigger that breakout, and then drops back below some key near-term support levels at $28.11 to $27.51 a share with high volume. If we get that move, then AEGR will set up to re-test or possibly take out its next major support levels at $25.92 to $22 a share.