Goldman Sachs Was Right About Lucid And Celsius: Why Plug Power Stock Could Be The Next 'Earnings-Day Short Squeeze'

Goldman Sachs highlighted several short-squeeze earnings plays at the beginning of the month. One of the names on the list is set to report after the close.

What To Know: In a note to clients at the beginning of August, analysts at Goldman Sachs called out a trend that has emerged this earnings season. 

"Earnings-day moves have been positive in stocks that had high short interest ahead of earnings, but negative on average for less shorted stocks," Goldman analysts said. 

Goldman tracks a group of heavily shorted names in its "GS Most Shorted Rolling Basket" index. The firm highlighted several names as candidates for "earnings-day short squeezes," but specifically pointed to three "key names."

The key names to watch were Lucid Group Inc LCID, Celsius Holdings Inc CELH and Plug Power Inc PLUG. 

Lucid and Celsius have already reported. On Monday, Lucid missed analyst estimates on both the top and bottom line, but despite turning in worse-than-expected results, the EV maker's stock jumped 12.16% the following day, closing Tuesday at $7.19 per share. 

Celsius reported strong quarterly results after the close on Tuesday, and the stock was up approximately 20% at $172 at last check Wednesday. 

The results speak for themselves. Goldman is two for two on its key names to watch for earnings day moves.

The last name of the group, Plug Power, is set to report second-quarter results after the bell. The company is expected to report a loss of 26 cents per share on revenue of $242.24 million, according to estimates from Benzinga Pro.

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Benzinga's Take: Plug has missed bottom-line estimates for nine straight quarters, so trends are working against the green hydrogen company, but that could be the perfect setup for a potential earnings-day short squeeze.

Plug currently has relatively high short interest of 21.34%, according to data from Benzinga Pro. An earnings beat could be followed by a decent pop in shares and make Goldman three for three on key name callouts this earnings season. 

PLUG Price Action: Plug shares were down 1.60% at $10.74 at the time of publication, according to Benzinga Pro.

Photo: Oleksandr Pidvalnyi from Pixabay.