Updated from 6:59 a.m. EDT
Amid the stock market's continued volatility, stocks on the
have proven especially volatile, offering the opportunity for potential short-squeeze plays.
A short squeeze takes place when a stock's short-sellers -- those betting a stock will trade lower -- are forced to scramble to cover their bearish positions after the stock starts to rise on a positive catalyst. This short-covering works to drive the price of the stock up even more sharply.
One metric for measuring short-squeeze plays is the short ratio, which represents the number of days it would take a stock's short-sellers to cover their positions, based on the stock's recent average trading volume. The higher the short ratio, the sharper the stock's rise can be.
With recent market volatility in mind, Stockpickr has compiled a list of the
One Nasdaq stock with a very high short ratio is
, an Internet-based health information service that sports a short ratio of 15. The company, which is trading near its 52-week low, is scheduled to report first-quarter earnings on May 6. The stock has a price-to-earnings ratio of 24 and a P/E-to-growth ratio of 1.
WebMD is part of the Stockpickr portfolio called
, a list from last month of stocks that reported large stock purchases by company insiders, or executives. Other stocks in the portfolio include
, which has a short ratio of 25.5,
Lions Gate Entertainment
, with a short ratio of 9, and
Enterprise Products Partners
, at 2.4.
Another high-short ratio stock that trades on the Nasdaq is
. This marketer of natural and organic food products and personal care products has a short ratio of 22. The company just announced that it bought Daily Bread Ltd., a British food producer; and last week JPMorgan downgraded the stock from overweight to underweight, citing potential downside given disappointing sales trends. The stock has a P/E of 22 and a PEG of 1.2.
Hain stock is owned by the
, a five-star Morningstar-rated fund managed by Allen Steinkopf. Other stocks held by First American include
Helix Energy Solutions Group
, with a 2.1 short ratio,
, with a short ratio of 9.1, and
, with a 6.1 short ratio.
is another highly shorted Nasdaq stock, with a short ratio of 16. The business products and supply company is scheduled to discuss first-quarter earnings results in a May 2 conference call. The stock has a P/E ratio of 13 and a PEG ratio of 0.8.
United Stationers is in the portfolio of
, a four-star rated fund managed by Richard Aster. The fund also holds shares of
, which has an 11.6 short ratio, and
, which has a 1.8 short ratio.
To see the entire list of the current
, go to Stockpickr.com.
At the time of publication, Altucher and/or his fund had no positions in stocks mentioned, although positions may change at any time.
James Altucher is president of
LLC, a wholly owned subsidiary of TheStreet.com and part of its network of Web properties, and a managing partner at Formula Capital, an alternative asset management firm that runs a fund of hedge funds. He is also a weekly columnist for the
and the author of
Trade Like a Hedge Fund
Trade Like Warren Buffett
. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Altucher appreciates your feedback;
to send him an email.
TheStreet.com has a revenue-sharing relationship with Trader's Library under which it receives a portion of the revenue from purchases by customers directed there from TheStreet.com.