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Another earnings short-squeeze prospect is natural and organic food player
BNNY), which is set to release numbers on Thursday after the market close. Wall Street analysts, on average, expect Annie's to report revenue of $57.12 million on earnings of 29 cents per share.
The current short interest as a percentage of the float for Annie's is extremely high at 27.3%. That means that out of the 14.35 million shares in the tradable float, 3.73 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 5.6%, or by about 198,000 shares. If the bears get caught pressing their bets into a strong quarter, then shares of BNNY could rip sharply higher post-earnings as the bears rush to cover some of their short positions.
From a technical perspective, BNNY is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock recently formed a double bottom chart pattern at $46.27 to $46.74 a share. Following that bottom, shares of BNNY have started to trend back above its 50-day moving average, and it's quickly pushing within range of triggering a big breakout trade.
If you're bullish on BNNY, 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 at $49.89 a share to its all-time high at $52.38 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 211,715 shares. If that breakout hits, then BNNY will set up to enter new all-time high territory, which is bullish technical price action. Some possible upside targets off that breakout are $60 to $70 a share.
I would simply avoid BNNY or look for short-biased trades if after earnings it fails to trigger that breakout, and then drops back below its 50-day moving average at $48.03 a share to more support at $46.74 to $46.27 a share with high volume. If we get that move, then BNNY will set up to re-test or possibly take out its next major support levels at $42 to $40 a share.
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