9 Highly Shorted Companies Significantly Undervalued Against the Industry

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Includes: ENTR, GME, HGG, MDP, NTRI, PWER, SAH, VECO, WRK
by: Kapitall

If you're looking for short squeeze ideas, the following list might offer an interesting starting point. The following is a list of highly shorted stocks that are comparably undervalued against their industry.

To compile this list we began with a universe of more than 50 stocks with market caps above $100M and short float above 15%. We then took a closer look at the following ratios and compared them to the industry averages:

- Price/Earnings Ratio
- Price to Earnings Growth Ratio
- Price to Free Cash Flow Ratio

We ultimately found nine stocks, which are all trading below the industry average on each of these categories.

Considering this information, which of these stocks do you find more attractively priced? Full details below.



1. Sonic Automotive Inc. (NYSE:SAH) is in the auto dealerships industry. With a market cap of $751.20M, current short float is at 17.2% (equivalent to 9.76 days of average volume). PEG at 0.66 vs. industry average 1.14. P/CF 2.46 vs. industry average 12.1. The stock has had a couple of great days, gaining 8.63% over the last week.

2. GameStop Corp. (NYSE:GME) is in the electronics stores industry. The company has a market cap of $3.43B. Current short float at 25.69% (equivalent to 8.89 days of average volume). PEG at 0.68 vs. industry average 1.14. P/CF 2.88 vs. industry average 11.95. Exhibiting strong upside momentum--currently trading 9.75% above its SMA20, 10.87% above its SMA50, and 12.71% above its SMA200. The stock has had a couple of great days, gaining 7.2% over the last week.

3. Entropic Communications, Inc. (NASDAQ:ENTR) is in the semiconductor industry. Market cap of $715.83M. Current short float at 35.08% (equivalent to 7.53 days of average volume). PEG at 0.62 vs. industry average 1.3. P/CF 3.52 vs. industry average 12.2. The stock has had a couple of great days, gaining 5.01% over the last week.

4. hhgregg, Inc. (NYSE:HGG) is in the electronics stores industry. Market cap of $535.29M. Current short float at 27.62% (equivalent to 10.48 days of average volume). PEG at 0.68 vs. industry average 1.14. P/CF 3.93 vs. industry average 11.95. The stock has lost 46.59% over the last year.

5. Veeco Instruments Inc. (NASDAQ:VECO)
is in the semiconductor equipment & materials industry. Market cap of $2.08B. Current short float at 27.71% (equivalent to 7.04 days of average volume). PEG at 0.61 vs. industry average 1.3. P/CF 5.1 vs. industry average 12.2. This is a risky stock that is significantly more volatile than the overall market (beta = 2.46). The stock has had a couple of great days, gaining 5.06% over the last week.

6. Power-One Inc. (NASDAQ:PWER) is in the diversified electronics industry. Market cap of $929.97M.Current short float at 40.28% (equivalent to 6.04 days of average volume). PEG at 0.43 vs. industry average 1.04. P/CF 3.9 vs. industry average 6.86. This is a risky stock that is significantly more volatile than the overall market (beta = 2.2). The stock has had a couple of great days, gaining 7.07% over the last week.

7. Meredith Corp. (NYSE:MDP) is in the periodicals industry. Market cap of $1.55B. Current short float at 17.91% (equivalent to 10.17 days of average volume). PEG at 0.94 vs. industry average 0.99. P/CFC 7.7 vs. industry average 8.73. The stock has gained 1.7% over the last year.

8. Rock-Tenn Co. (RKT)
is in the paper & paper products industry. Market cap of $2.72B. Current short float at 24.99% (equivalent to 8.61 days of average volume). PEG at 2.45 vs. industry average 3.19. P/CF 7.71 vs. industry average 15.1. The stock has gained 53.11% over the last year.

9. NutriSystem Inc. (NASDAQ:NTRI)
is in the consumer services industry. Market cap of $386.85M. Current short float at 27.14% (equivalent to 11.29 days of average volume). PEG at 0.74 vs. industry average 1.65. P/CF 9.89 vs. industry average 31.41. Offers a good dividend, and appears to have good liquidity to back it up--dividend yield at 4.85%, current ratio at 2.87, and quick ratio at 2.14. The stock has lost 15.8% over the last year.

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