3 Stocks that Could Make Huge Moves This Week

3 Stocks That Could Make Huge Moves This Week

AmbarellaAmbarella develops the video technology enabling tiny cameras to function. The company is expected to report earnings on Tuesday afternoon. Currently, 30% of Ambarella’s shares are sold short.

The company currently sells for 36 times earnings, which isn’t cheap. Bears believe the Ambarella is overly reliant on GoPro and that its technology could become commoditized.

Here’s What You Should WatchOver the Short Term• Ambarella is expected to

report earnings of $0.81 per share for the previous quarter.

• Analysts expect the company to have collected $81.7 million in sales for the previous quarter.

• For the full fiscal year, analysts are expecting the company to earn $3.07 per share on sales of $325 million.

Over the Long Term• Pay attention to any

management comments about the demand for Ambarella chips for burgeoning technologies like drones.

• Last quarter, margins expanded to 64.7%, a great sign that commoditization is not a risk. Pay attention to where this stands now.

Five BelowFive Below is a discount retailer of teen and young adult clothes. The company is expected to report earnings on Wednesday evening.

Currently, 19% of Five Below’s shares are sold short.

Retail has been a tough industry since the great recession. With shares of Five Below selling for almost 40 times earnings, there are very high expectations baked into the price.

Here’s What You Should WatchOver the Short Term• Five Below is expected to

announce $185 million in revenue for the previous quarter.

• The company is expected to have earned $0.13 per share last quarter.

• For the full fiscal year, expectations are set for $827 million in revenue and earnings of $1.05 per share.

Over the Long Term• Comparable-store sales are

always important. Last quarter, the metric showed growth of 1.7%. If Five Below is truly worth its current price, it will need to show the 4% to 5% growth that management expects.

CienaCiena is a global provider of equipment for the telecom industry. The company is expected to report earnings on Thursday morning.

Currently, 22% of Ciena’s shares are sold short.

Between October of last year and mid-August, shares of Ciena surged over 70%. That, plus low growth in broadband spending by some network giants, has investors bearish.

Here’s What You Should WatchOver the Short Term• Analysts are expecting Ciena

to report revenue of $629 million for the previous quarter.

• They are also expecting the company to have earned $0.33 per share for the previous quarter.

• For the current quarter, analysts are expecting earnings of $0.38 per share on $655 million in revenue.

Over the Long Term• Pay attention to management

comments on its position within Software-Defined Networking (SDN). Currently, this accounts for 19% of the company’s revenues.

• Gross margins expanded to 43.8% last quarter. It’s important to maintain this level to prove to investors that Ciena doesn’t need to discount on price to remain competitive.

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