Enovix Prepares For Q3 Earnings: Analyst Sees Potential 'Squeeze,' But Technical Signals Raise Red Flags

Enovix Corp ENVX is revving up for its third-quarter earnings on Tuesday. With the stock up a whopping 60% in the past six months, the big question is, can it keep the momentum going?

Wall Street analysts expect the company to report a 20-cent loss per share and $4.11 million in revenue this quarter.

According to JPMorgan analyst Bill Peterson, the market is watching closely for any big announcements, and the high level of short interest means the stock could be in for a wild ride if there’s good news.

Positive Earnings, Short Squeeze Could Gear Up Enovix Stock

Enovix stock currently sports a short interest of 43.87%, according to data from Benzinga Pro.

Peterson thinks a short squeeze might be on the table if Enovix delivers positive updates. "Short interest remains elevated, and we could see a squeeze exacerbate any positive stock reaction to favorable commentary during Q3 earnings," he notes. Investors are watching for progress on customer validation, Site Acceptance Testing, and the much-anticipated second smartphone OEM deal, which could very well involve a Chinese manufacturer, according to Peterson.

While he's bullish long-term, Peterson has adjusted Enovix’s price target from $18 to $15, citing challenges across the broader space but maintaining his Overweight rating, as he remains “cautiously optimistic on the pace of Enovix's revenue trajectory from 2025 onward.”

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The Chart Tells A Different Story

While JPMorgan is cautiously optimistic, the technical indicators aren’t painting a rosy picture in the short term. Let's break it down:

Chart created using Benzinga Pro

• Bearish Momentum: Enovix's current price of $10.41 is below its five, 20 and 50-day exponential moving averages (EMAs), which is typically a sign that the stock is under some selling pressure.
• Mixed Moving Averages: The 50-day simple moving average (SMA) sits at $10.05, suggesting some bullish potential, but with the eight-day, 20-day and 200-day SMAs all flashing bearish signals, it's a tug-of-war between short-term bears and a glimmer of long-term hope.
• MACD and RSI: The Moving Average Convergence Divergence (MACD) indicator is in bullish territory at 0.22, while the Relative Strength Index (RSI) at 46.31 suggests the stock is in the neutral territory.

While the fundamentals and analyst outlook remain bullish, the technicals show that Enovix could be in for a rough ride, at least in the short term.

All eyes will be on Tuesday’s earnings call and whether Enovix can deliver the kind of news that ignites a short squeeze—or if the bears will have their day. Either way, buckle up for what could be a volatile week for Enovix stock.

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Image created using artificial intelligence via Midjourney.