Another earnings short-squeeze prospect is producer, marketer and distributor of fresh fruit and vegetables Dole Food (DOLE), which is set to release numbers on Tuesday after the market close. Wall Street analysts, on average, expect Dole Food to report revenue of $1.13 billion on a loss of 2 cents per share.
The current short interest as a percentage of the float for Dole Food is very high at 15.9%. That means that out of the 51.43 million shares in the tradable float, 8.36 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 23.8%, or by about 1.60 million shares. If the bears are caught pressing their bets too aggressively into this quarter, then we could easily see shares of DOLE skyrocket post-earnings.
From a technical perspective, DOLE 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 $10.88 on the downside and $12.09 on the upside. A high-volume move above the upper-end of that range could trigger a major breakout trade for shares of DOLE post-earnings.If you're bullish on DOLE, 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 $11.81 to $12.09 a share and then above more resistance at $12.72 to $12.87 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 1.39 million shares. If that breakout triggers, then DOLE will set up to re-test or possibly take out its next major overhead resistance levels at $14 to $14.60 a share. I would avoid DOLE 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 at $10.88 a share with high volume. If we get that move, then DOLE will set up to re-test or possibly take out its next major support levels at $10.06 to $9.55 a share.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV