Dividend Stocks Reporting Earnings This Week With Short Covering

Earnings present an opportunity to cash in on mispriced trades and earnings surprises. Of course, the greatest challenge is finding names that will outperform. (STAY AHEAD OF THE CURVE: Follow Kapitall on Twitter)

One of the clearest sentiment indicators comes from short sellers. Changes in the number of shares shorted over time can give a clue as to whether investors are becoming more or less pessimistic about the name.

How it works

Shorting a share involves borrowing the share and immediately selling it with the agreement to buy it back and return it in the future. This is profitable if the share price drops (short sellers can keep the difference in price), so short selling indicates a bearish (or pessimistic) view on the stock’s prospects.

Therefore when a stock sees fewer shares shorted over time, it indicates greater optimism from investors.

We ran a screen with this in mind, screening dividend stocks reporting earnings the rest of this next (Oct 16-19) for those seeing significant decreases in shares shorted month-over-month.

Business Section: Investing Ideas

Below are the results of this screen. These dividend stocks (yields above 1%) have seen increasing bullishness from short sellers month-over-month.

Do you think these names will report earnings to the upside? List Average 1-Year Return: 28%.

Press play to see changes in dividend yield over time:

1. Greenhill & Co., Inc. (GHL, Earnings, Analysts, Financials): Operates as an independent investment bank. Market cap at $1.4B, most recent closing price at $48.55. Dividend yield 3.63. Shares shorted have decreased from 4.53M to 3.45M over the last month, a decrease which represents about 4.05% of the company’s float of 26.68M shares. Days to cover ratio at 10.66 days. Earnings date: Oct 17.

2. Steel Dynamics Inc. (STLD, Earnings, Analysts, Financials): Engages in the manufacture and sale of steel products in the United States. Market cap at $2.65B, most recent closing price at $12.10. Dividend yield 3.24. Shares shorted have decreased from 6.55M to 4.37M over the last month, a decrease which represents about 1.04% of the company’s float of 208.68M shares. Days to cover ratio at 1.48 days. Earnings date: Oct 17.

3. CVB Financial Corp. (CVBF, Earnings, Analysts, Financials): Operates as a bank holding company for Citizens Business Bank that provides various retail banking and financial services to small to mid-sized businesses, high net-worth individuals, and professionals in the United States. Market cap at $1.23B, most recent closing price at $11.75. Dividend yield 2.89. Shares shorted have decreased from 7.17M to 6.04M over the last month, a decrease which represents about 1.28% of the company’s float of 88.30M shares. Days to cover ratio at 13.24 days. Earnings date: Oct 17.

4. Briggs & Stratton Corp. (BGG, Earnings, Analysts, Financials): Designs, manufactures, markets, and services air cooled gasoline engines for outdoor power equipment worldwide. Market cap at $889.82M, most recent closing price at $18.60. Dividend yield 2.55. Shares shorted have decreased from 9.96M to 9.17M over the last month, a decrease which represents about 1.8% of the company’s float of 43.81M shares. Days to cover ratio at 27.66 days. Earnings date: Oct 18.

5. Huntington Bancshares Incorporated (HBAN, Earnings, Analysts, Financials): Operates as the holding company for The Huntington National Bank that provides commercial and consumer banking services. Market cap at $5.95B, most recent closing price at $6.93. Dividend yield 2.29. Shares shorted have decreased from 27.20M to 13.38M over the last month, a decrease which represents about 1.62% of the company’s float of 850.74M shares. Days to cover ratio at 1.43 days. Earnings date: Oct 18.

6. Astoria Financial Corporation (AF, Earnings, Analysts, Financials): Operates as the bank holding company for Astoria Federal Savings and Loan Association that provides various banking services in the United States. Market cap at $1.01B, most recent closing price at $10.25. Dividend yield 1.57. Shares shorted have decreased from 10.99M to 10.29M over the last month, a decrease which represents about 1.03% of the company’s float of 67.73M shares. Days to cover ratio at 18.47 days. Earnings date: Oct 17.