Short Sellers See Upside for These 5 Stocks Rated “Buy” by UBS

Short Sellers See Upside for These 5 Stocks Rated “Buy” by UBS

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Looking for stocks practically radiating with optimism? One great source for bullish stock ideas comes from sell side analyst ratings. When these bank analysts write a report on a company, and the analyst is reputable, it can have a big effect on the stock price.

With this in mind we ran a screen for stocks with current "Buy" ratings from UBS (i.e. analysts at UBS expect these stocks to outperform).

Short Covering

Another great way to see how smart investors feel about a stock is to look at the collective trading activity of short sellers.  

We screened the "buy" rated stocks for those with bullish sentiment from short sellers, with significant short covering (decreases in shares shorted) month-over-month. Short sellers earn when share price falls, so a pullback suggest they believe the stock has more upside than downside to price in.

Business Section: Investing Ideas

We combine both bullish signals in making the list below. All 5 stocks that made the list have UBS buy ratings, which have been renewed in the past year, and significant short covering activity month-over-month. 

Also of note, analysts on average have a “buy” rating for the stocks on the list. The chart is interactive, press play to see how these ratings have changed over time.

Use this list as a starting point for your own analysis.

1. Abercrombie & Fitch Co. (ANF, Earnings, Analysts, Financials): Operates as a specialty retailer of casual apparel for men, women, and kids. Market cap at $3.99B, most recent closing price at $50.19. On 05/01/2012, UBS had a Buy rating on the stock. Shares shorted have decreased from 7.29M to 6.22M over the last month, a decrease which represents about 1.46% of the company's float of 73.19M shares. Days to cover ratio at 1.99 days.

 

2. Fortinet Inc. (FTNT, Earnings, Analysts, Financials): Provides network security appliances and unified threat management (UTM) network security solutions to enterprises, service providers, and government entities worldwide. Market cap at $3.66B, most recent closing price at $22.89. On 06/13/2012, UBS had a Buy rating on the stock. Shares shorted have decreased from 4.45M to 3.04M over the last month, a decrease which represents about 1.05% of the company's float of 133.72M shares. Days to cover ratio at 1.11 days.

 

3. Mellanox Technologies, Ltd. (MLNX, Earnings, Analysts, Financials): Engages in the design, development, marketing, and sale of interconnect products primarily in North America, Israel, Europe, and Asia. Market cap at $2.24B, most recent closing price at $53.0. On 01/15/2013, UBS had a Buy rating on the stock. Shares shorted have decreased from 7.29M to 6.76M over the last month, a decrease which represents about 1.45% of the company's float of 36.51M shares. Days to cover ratio at 4.52 days.

 

4. Altria Group Inc. (MO, Earnings, Analysts, Financials): Engages in the manufacture and sale of cigarettes, smokeless products, and wine in the United States and internationally. Market cap at $68.63B, most recent closing price at $33.89. On 11/19/2012, UBS had a Buy rating on the stock. Shares shorted have decreased from 37.28M to 12.32M over the last month, a decrease which represents about 1.25% of the company's float of 2.00B shares. Days to cover ratio at 1.23 days.

 

5. The Fresh Market, Inc. (TFM, Earnings, Analysts, Financials): Operates as a specialty grocery retailer. Market cap at $2.32B, most recent closing price at $48.24. On 03/13/2012, UBS had a Buy rating on the stock. Shares shorted have decreased from 4.28M to 3.70M over the last month, a decrease which represents about 1.44% of the company's float of 40.17M shares. Days to cover ratio at 6.21 days.
 

List compiled by Rebecca Lipman. Did you find this list useful as a starting point for your analysis? Do you have a list requests? Leave your comments below and we’ll do our best to deliver.

 

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One Response to “Short Sellers See Upside for These 5 Stocks Rated “Buy” by UBS”

  1. Jared Bates says:

    If you want to close an open short position these are great picks. I love the optimism behind it but your rundown of FTNT resonates the most with me.

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