Short Sellers Think 10 Rallying Dividend Consumer Stocks Have More Upside

When a stock is rallying, that is to say that the price is now higher than its 20, 50 and 200-day moving averages, current and potential investors have one question: Does the stock have more upside to price in? 

There's no easy answer to this, but there are clues we can take to guide our analysis. One indication of sentiment comes from short seller data. [More Lists:  4 Stocks Undervalued by to Target Price with Short Covering]

BUILDING THE LIST

To create the list below we created a stock universe of consumer good companies offering dividends and trading above their 20, 50 and 200 day moving average (MA). Investors will question if the momentum behind these stocks is burning out, or if it has more upside to price in.

For ideas, we screened the universe for bullish sentiment from short sellers, with significant short covering activity month over month. This suggests more upside is expected. 

So what of you think is in store for the 10 stocks that made our list? Use this as a starting point for your own analysis. 

Interactive tools: Press play to see changes in the dividend yield over the past two years. Click through to access more free tools and data on the companies listed.


1. American Greetings Corp. ( AM ): Engages in the design, manufacture, and sale of greeting cards and other social expression products worldwide. Market cap at $573.95M, most recent closing price at $18.14.

Dividend yield at 3.31%.

The stocks is currently rallying 9.76% above its 20-day MA, 11.56% above its 50-day MA and 16.84% above its 200-day MA.

Shares shorted have decreased from 11.24M to 10.49M over the last month, a decrease which represents about 2.57% of the company's float of 29.21M shares. Days to cover ratio at 19.24 days.

2. The Cheesecake Factory Incorporated ( CAKE): Operates upscale, casual, and full-service dining restaurants in the United States. Market cap at $1.99B, most recent closing price at $37.76.

Dividend yield at 1.27%. Payout ratio: 13.07%.

The stocks is currently rallying 2.17% above its 20-day MA, 7.36% above its 50-day MA and 11.68% above its 200-day MA.

Shares shorted have decreased from 8.14M to 6.95M over the last month, a decrease which represents about 2.48% of the company's float of 48.01M shares. Days to cover ratio at 8.54 days.

3. Companhia Brasileira de Distribuicao ( CBD): Operates as a retailer of food products, clothing, home appliances, and other products through its chain of hypermarkets, supermarkets, specialized and department stores, convenience stores, and the Internet in Brazil. Market cap at $14.11B, most recent closing price at $53.56.

Dividend yield at 0.34%. Payout ratio: 23.75%.

The stocks is currently rallying 0.68% above its 20-day MA, 6.48% above its 50-day MA and 19.09% above its 200-day MA.

Shares shorted have decreased from 1.93M to 1.09M over the last month, a decrease which represents about 1.01% of the company's float of 82.96M shares. Days to cover ratio at 1.92 days.

4. Cracker Barrel Old Country Store, Inc. ( CBRL): Engages in the operation and development of the Cracker Barrel Old Country Store restaurant and retail concept in the United States. Market cap at $1.93B, most recent closing price at $81.37.

Dividend yield at 2.46%. Payout ratio: 34.72%.

The stocks is currently rallying 0.81% above its 20-day MA, 10.64% above its 50-day MA and 23.02% above its 200-day MA.

Shares shorted have decreased from 1.37M to 1.10M over the last month, a decrease which represents about 1.45% of the company's float of 18.57M shares. Days to cover ratio at 5.23 days.

5. Chico's FAS Inc. ( CHS): Operates as a specialty retailer of casual-to-dressy clothing, intimates, complementary accessories, and other non-clothing gift items. Market cap at $2.89B, most recent closing price at $17.73.

Dividend yield at 1.24%. Payout ratio: 19.71%.

The stocks is currently rallying 1.21% above its 20-day MA, 1.45% above its 50-day MA and 1.66% above its 200-day MA.

Shares shorted have decreased from 8.57M to 6.56M over the last month, a decrease which represents about 1.3% of the company's float of 155.16M shares. Days to cover ratio at 2.06 days.

6. Brinker International Inc. ( EAT): Develops, operates, and franchises various restaurant brands primarily in the United States. Market cap at $2.72B, most recent closing price at $38.48.

Dividend yield at 2.08%. Payout ratio: 33.83%.

The stocks is currently rallying 5.41% above its 20-day MA, 11.85% above its 50-day MA and 17.45% above its 200-day MA.

Shares shorted have decreased from 6.72M to 5.04M over the last month, a decrease which represents about 2.57% of the company's float of 65.26M shares. Days to cover ratio at 3.13 days.

7. Hot Topic Inc. ( HOTT): Operates as a mall- and Web-based specialty retailer in the United States. Market cap at $565.31M, most recent closing price at $13.90.

Dividend yield at 2.3%. Payout ratio: 68.93%.

The stocks is currently rallying 0.14% above its 20-day MA, 14.48% above its 50-day MA and 37.39% above its 200-day MA.

Shares shorted have decreased from 7.15M to 6.58M over the last month, a decrease which represents about 1.68% of the company's float of 33.87M shares. Days to cover ratio at 4.63 days.

8. Meredith Corp. ( MDP): Engages in magazine publishing and related brand licensing, television broadcasting, integrated marketing, interactive media, and video production businesses in the United States. Market cap at $1.4B, most recent closing price at $38.94.

Dividend yield at 4.19%. Payout ratio: 61.3%.

The stocks is currently rallying 2.71% above its 20-day MA, 0.42% above its 50-day MA and 12.9% above its 200-day MA.

Shares shorted have decreased from 6.57M to 5.65M over the last month, a decrease which represents about 2.98% of the company's float of 30.88M shares. Days to cover ratio at 10.17 days.

9. Omnicare Inc. ( OCR): Provides pharmaceuticals, and related pharmacy and ancillary services to long-term healthcare institutions. Market cap at $4.32B, most recent closing price at $41.29.

Dividend yield at 1.36%. Payout ratio: 23.52%.

The stocks is currently rallying 4.05% above its 20-day MA, 5.21% above its 50-day MA and 17.34% above its 200-day MA.

Shares shorted have decreased from 12.74M to 11.37M over the last month, a decrease which represents about 1.42% of the company's float of 96.53M shares. Days to cover ratio at 10.28 days.

10. Virgin Media, Inc. ( VMED): Provides of entertainment and communications services in the United Kingdom. Market cap at $13.32B, most recent closing price at $49.46.

Dividend yield at 0.32%. Payout ratio: 0.96%.

The stocks is currently rallying 2.87% above its 20-day MA, 8.32% above its 50-day MA and 43.44% above its 200-day MA.

Shares shorted have decreased from 31.68M to 28.26M over the last month, a decrease which represents about 1.36% of the company's float of 252.27M shares. Days to cover ratio at 3.4 days.
 

- Rebecca Lipman, Kapitall

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