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5 Short-Squeeze Stocks Ready to Pop

Green Mountain Coffee Roasters

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Pain is an important teacher; when a child touches a hot stove, he learns not to touch it again. With that in mind, short sellers in Green Mountain Coffee Roasters (GMCR) appear to be slow learners. Despite seeing the stock double so far this year on an earlier short squeeze move, sellers have piled back into GMCR this summer, pushing the stocks short interest ratio back up to 11.4.

At current levels, it would take more than two weeks of buying for shorts to exit their bets.

>>5 Stocks With Big Insider Buying

Green Mountain owns Keurig, the brand of beverage brewers that use self-contained K-Cups to make coffee, teas, and other drinks. While Keurig's "fad" status has certainly helped to convince short sellers that GMCR was due to drop, the fact remains that the firm has already done most of the hard work in getting Keurig machines accepted by consumers. With brewers essentially ubiquitous at this point, the firm is able to make money on its cash cow: the K-Cups.

K-Cups offer a sticky revenue stream for Green Mountain. Because they're proprietary, the firm can command premium pricing for them. Big new rivals, including competition from Starbucks (SBUX) have fallen flat in stealing market from GMCR's Keurig -- and short sellers shouldn't expect a sudden change in consumer buying to take the wind out of this stock's sales.

To see these short squeezes in action, check out this week's Short Squeezes portfolio on Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.

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Follow Stockpickr on Twitter and become a fan on Facebook.

At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on CNBC.com. Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.

Follow Jonas on Twitter @JonasElmerraji

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