NetApp’s (NTAP) stock and short interest have both risen ahead of earnings. Historical trends and increased AI spending suggest positive momentum, with implied moves of 7%. NTAP’s YTD gains are tied to earnings, and both stock momentum and short interest trends align with a forecasted post-earnings increase.

NTAP reports earnings tomorrow after the close. It typically moves 6% on earnings, with an implied move of 7%.

Historically, the stock shows strong momentum the week before and after earnings, with consistent gains. Each time the stock is up the week before, it has also risen the week after.

Short interest is also a predictive indicator, though less sensitive. When short positions rise, the stock tends to increase 3 out of 5 times, and decrease 1 out of 5 times.

In this case the two methods both expect a higher return after earnings, and these indicators can add.

The average return on earnings is 4%, and the stock is up 38% YTD, with most of the gains tied to earnings reports.

While short interest has recently doubled, it only increased after a dip post-earnings, with the stock remaining in the same range.

NTAP is benefiting from increased AI spending.

Despite NTAP’s recent sideways movement, the net gain/loss for short positions has been close to zero.

NTAP’s earnings report is expected to drive movement, with historical momentum and rising AI investments pointing to gains. With short interest doubling and implied moves at 7%, NTAP offers opportunities for investors seeking exposure to AI-driven growth.

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