I previously posted a bullish trade on ESI over a month ago ahead of the company’s earnings announcement. Shares have appreciated from $14 all the way up to $28 a few days ago. A double in the share price is quite a move. (more…)
Bears could get nervous about ITT Education (ESI)
While the current trading environment is not extremely conducive for short squeezes, I think we could get one in ITT education (ESI) when they report earnings on April 25. ESI has historically been a highly shorted stock, which has undergone extreme price fluctuations due to bearish speculation through high short interest. There is not a lot to like in the For profit education industry when you consider that the government has drawn back many of the educational grants for education seekers. The precipitous drop in shares of APOL, ESI, STRA are indications of that. (more…)
Bubble in Utilities? Short OGE
Recently utility stocks have been getting bid up in a manic frenzy as investors pile into low volatility ETFs that have a large holding of utility stocks, and as investors seek to park their nest eggs in the perceived safety of stable, cash flow rich companies. (more…)
Blue Nile – An earnings disappointment leads to opportunity
Blue Nile has a combination of things going on that I like to look for as a speculative trade: (more…)
Bearish on Energizer (ENR)
Energizer looks like a good “short the dead cat bounce” opportunity, bumping up against the 50 SMA and finding overhead resistance around the same level. No unusual options activity. It came up on my short screen, looking for stocks under their 200 and 50 day moving averages, negative sales growth q/q, over 50% institutionally owned, short float under 10%. Also, some bearish comments from Zacks about their profit picture: (more…)
Long Constant Contact (CTCT) ahead of Apr 26 Earnings
Constant Contact is up today in a down market. While Google may be down today, it’s earnings release yesterday noted some strong advertising spending, which bodes well for Constant Contact. I am expecting a run-up from here heading into the earnings announcement in a few weeks. Short interest is very high, and we’ve seen 2 days of what could be considered short covering.
Bullish speculation on Hovnanian (HOV)
The tide seems to be shifting in the housing market, and there is bullishness on wall street. Short squeezes are occurring left and right, and we all are wondering how long the party will last. From what I can tell, today’s pullback is being bought, and we are at very low volatility ranges making bullish setups still the ones in favor. Where this is risk there is reward, and Hovnanian is a stock I like in a bullish environment. Yesterday, call option volume in the Feb $3 contract was 5,900, with the volume traded outpacing open interest by 4 to 1. That’s a very bullish commitment by some options speculator. Today the stock gapped down with the rest of the market but it’s steadily climbed back from that. Not all stocks have climbed back so it’s a good sign. (more…)
Sell put on Jabil Circuit (JBL)
So I am going to try and take advantage of today’s higher options prices to sell the $20 put on Jabil Circuit. (more…)
Buying the MBI Short Squeeze
I think there is a chance I am a little late to this party but if the calculations are correct, this stock could go to $25 per share if shorts have to cover. Depending on where you look, short interest looks to be around 20% of the floating shares. Since those investors are largely short based on information that is most likely not an issue anymore, they are likely to cover soon. (more…)
Understanding the Stock Short Interest Ratio
It pays to know who is betting against a company.
Every company has stock traders who believe its stock price is going to go up and stock traders who believe its stock price is going to go down. Typically, those stock traders who believe the stock price is going to go down simply put their money elsewhere by investing in other stocks. However, when stock traders believe so completely that a stock is going to go down, they actually sell the stock short. (more…)