NEW YORK ( TheStreet) - Three companies reporting earnings next week are a must watch, because they can make or break a lot of traders. Two of the stocks are short-squeeze candidates and the third can go either way. HOV data by YCharts
Analyst opinion is mixed. Most of those surveyed don't believe a buy or a sell is warranted. The stock appreciated 225% in the last year, and the average analyst target price for Hovnanian is $5.25. Hovnanian could turn a profit in 2013, and the market is pricing in sunnier days, but you want to buy this one only during dips. We don't know how the housing market will react to rising interest rates and at the time of writing, the average 30-year fixed rate is flirting with 4%. We have to travel back over a year, and almost into 2011 to find a week when average rates were over 4%. Regardless of why rates may continue to climb, we can safely assume that with all else being equal, higher rates are inversely correlated with home prices and demand. Because of those expected headwinds, which also create price and profit pressure, analysts may be generous with 2014 profit projections near 50 cents a share. Without any hiccups, a safer number to model is 40 to 45 cents for upside potential.