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If you like to invest wherever short-sellers are getting squeezed out, then this article will provide with a group of companies you may want to keep on your radar...

To compile this list we looked for stocks with these characteristics:
- 3-year free operating cash flow growth rate above 20%
- EBITDA > Total debt, as of the most recent fiscal year
- Experiencing a significant drop in shorted shares

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.


We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.



Considering this data, which of stocks are you most bullish about?

1. Ancestry.com Inc. (ACOM): Internet Information Providers Industry. Market cap of $1.64B. FOCF 3-year CAGR 52.71%. Most recent fiscal year EBITDA at $95.91M (company has no debt). Shorted shares dropped from 6.10M to 5.44M shares, this is change equivalent to 2.52% of the total float. The stock has performed poorly over the last month, losing 12.73%.

2. Acme Packet, Inc. (APKT):
Communication Equipment Industry. Market cap of $3.84B. FOCF 3-year CAGR 56.33%. Most recent fiscal year EBITDA at $74.18M (company has no debt). Shorted shares dropped from 5.52M to 4.48M shares, this is change equivalent to 1.96% of the total float. The stock has performed poorly over the last month, losing 21.93%.

3. Cninsure Inc. (CISG): Insurance Brokers Industry. Market cap of $700.74M. FOCF 3-year CAGR 147.82%. Most recent fiscal year EBITDA at $74.64M (company has no debt). Shorted shares dropped from 7.24M to 6.87M shares, this is change equivalent to 1.29% of the total float. It's been a rough couple of days for the stock, losing 10.05% over the last week.

4. Changyou.com Limited (CYOU): Multimedia & Graphics Software Industry. Market cap of $1.88B. FOCF 3-year CAGR 64.58%. Most recent fiscal year EBITDA at $209.63M (company has no debt). Shorted shares dropped from 1.08M to 840.29K shares, this is change equivalent to 2.4% of the total float. The stock has performed poorly over the last month, losing 14.21%.

5. Mercadolibre, Inc. (MELI): Business Services Industry. Market cap of $3.28B. FOCF 3-year CAGR 128.97%. Most recent fiscal year EBITDA at $79.52M vs. a total debt balance of $0.29M. Shorted shares dropped from 3.57M to 3.39M shares, this is change equivalent to 0.66% of the total float. The stock has performed poorly over the last month, losing 16.45%.

6. Oshkosh Corporation (OSK): Trucks & Other Vehicles Industry. Market cap of $2.38B. FOCF 3-year CAGR 24.55%. Most recent fiscal year EBITDA at $1.54B vs. a total debt balance of $1.3B. Shorted shares dropped from 2.92M to 2.30M shares, this is change equivalent to 0.69% of the total float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.54). The stock has lost 26.04% over the last year.

7. Research In Motion Limited (RIMM):
Diversified Communication Services Industry. Market cap of $13.57B. FOCF 3-year CAGR 41.55%. Most recent fiscal year EBITDA at $5.59B (company has no debt). Shorted shares dropped from 29.05M to 25.55M shares, this is change equivalent to 0.75% of the total float. It's been a rough couple of days for the stock, losing 28.48% over the last week.

8. Silicon Laboratories Inc. (SLAB):
Semiconductor Industry. Market cap of $1.72B. FOCF 3-year CAGR 37.67%. Most recent fiscal year EBITDA at $105.96M (company has no debt). Shorted shares dropped from 3.82M to 3.41M shares, this is change equivalent to 1.0% of the total float. The stock is a short squeeze candidate, with a short float at 8.28% (equivalent to 8.3 days of average volume). The stock has performed poorly over the last month, losing 13.35%.

9. Skyworks Solutions Inc. (SWKS):
Semiconductor Industry. Market cap of $4.04B. FOCF 3-year CAGR 47.01%. Most recent fiscal year EBITDA at $252.37M vs. a total debt balance of $74.74M. Shorted shares dropped from 9.80M to 8.12M shares, this is change equivalent to 0.91% of the total float. It's been a rough couple of days for the stock, losing 7.74% over the last week.

10. Synaptics Inc. (SYNA):
Computer Peripherals Industry. Market cap of $880.57M. FOCF 3-year CAGR 72.34%. Most recent fiscal year EBITDA at $70.36M vs. a total debt balance of $2.31M. Shorted shares dropped from 10.09M to 9.43M shares, this is change equivalent to 1.94% of the total float. Might be undervalued at current levels, with a PEG ratio at 0.76, and P/FCF ratio at 9.95. The stock has performed poorly over the last month, losing 12.49%.

*Data sourced from Screener.co, Yahoo! Finance and Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 10 Stocks With Growing Cash Flows, Low Debt and Short Covering