Mid-January Short Interest Report Shows 8 Stocks with Good Fundamentals and High Short Interest
The most recent mania to hit the market seems to be stocks with high short interest. The huge spikes in Gamestop (GME) and AMC Entertainment (AMC) brought attention to an indicator that I’ve been using for 20 years. The most recent short interest reports recently came out and they are updated through January 15.
Some investors have been buying stocks simply because of their short interest level, but I am of the opinion that some stocks have such poor fundamentals that they should have high short interest levels. The stocks may rally over the short term, but in the end, the fundamentals are so bad that the company isn’t worth owning over the long term. These companies have seen earnings and revenue decline year after year and have poor profitability measurements.
Conversely, there are companies with high short interest levels that have strong fundamentals, have seen strong earnings and revenue growth, and have good profitability measurements. Companies that fit this description are much more appealing to me.
Once the new reports were published, I uploaded 37 stocks in to the Tickeron screener. These stocks were the ones with the highest percentage of short interest compared to the number of shares in the public float. From that list of 37 stocks, I isolated eight stocks that had an overall fundamental picture that I liked.
Of the eight stocks, the Tickeron scorecard has five with “strong buy” ratings, one with a “buy” rating, and two with “sell” ratings. The scorecard ratings are a combination of fundamental and technical analysis.
Several things jumped out at me about the eight stocks. First, all eight have received monthly bullish signals from Tickeron’s trend prediction tool over the last few days. Six of the eight signals have confidence levels over 80%. This suggests that these eight stocks have a high probability of moving higher over the next month.
The second thing that jumped out at me was the fact that six of the eight stocks have positive marks in one specific indicator that I rely on heavily—the SMR Rating. The only two stocks that don’t have a good SMR rating are Petmed Express (PETS) and National Beverage (FIZZ). Even those two companies have neutral readings in the category.
On the technical side, there are three areas where the majority of the stocks have received bullish signals of late. The three categories are the Aroon Indicator, the Momentum Indicator, and the Moving Average Indicator. All eight have received bullish signals from their Momentum Indicators in the last three weeks. Seven of the eight have received bullish signals from their Moving Average indicator without a single bearish signal. Seven of the eight have also received bullish signals from their Aroon Indicators with one bearish signal from National Beverage.
While I arrived at this list of stocks due to the short interest as a percentage of the float, there is another indicator that I like to look at as well and that is the short interest ratio. This indicator measures the number of shares sold short divided by the average daily trading volume. What this tells us is how long it will take short sellers to cover their positions based on the average daily volume.
My suggestion is to keep an eye on these stocks because if they start or continue to rally, the unwinding of the short positions can push the stock higher and higher.
IRBT in +8.86% Uptrend, advancing for three consecutive days on March 24, 2025
Moving higher for three straight days is viewed as a bullish sign. Keep an eye on this stock for future growth. Considering data from situations where IRBT advanced for three days, in of 275 cases, the price rose further within the following month. The odds of a continued upward trend are .
Technical Analysis (Indicators)
Bullish Trend Analysis
The RSI Indicator shows that the ticker has stayed in the oversold zone for 11 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an Uptrend is expected.
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 22 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
The Momentum Indicator moved above the 0 level on March 27, 2025. You may want to consider a long position or call options on IRBT as a result. In of 81 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
IRBT may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Bearish Trend Analysis
The Moving Average Convergence Divergence Histogram (MACD) for IRBT turned negative on February 24, 2025. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 49 similar instances when the indicator turned negative. In of the 49 cases the stock turned lower in the days that followed. This puts the odds of success at .
IRBT moved below its 50-day moving average on February 24, 2025 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for IRBT crossed bearishly below the 50-day moving average on March 03, 2025. This indicates that the trend has shifted lower and could be considered a sell signal. In of 16 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where IRBT declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for IRBT entered a downward trend on March 25, 2025. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.206) is normal, around the industry mean (7.048). P/E Ratio (48.077) is within average values for comparable stocks, (29.603). IRBT's Projected Growth (PEG Ratio) (0.000) is slightly lower than the industry average of (1.278). IRBT has a moderately low Dividend Yield (0.000) as compared to the industry average of (0.030). P/S Ratio (0.263) is also within normal values, averaging (1.000).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating slightly worse than average price growth. IRBT’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. IRBT’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 83, placing this stock worse than average.
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a company, which engages in the business of designing and building robots
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