Albemarle Corp’s (ALB) positive stock momentum and large short position could create squeeze risk after earnings. With a 12% short position and high squeeze score, the stock is positioned for potential volatility.

ALB has a large short position at 12%. The squeeze score is already pretty high a 62 where above 70 is considered significant.

ALB moves 5% on earnings and is implied to move 7.5%. This large, implied move on earnings could reflect the size of the short position.

Should ALB move higher on earnings the squeeze risk indicator could become significant.

The stock has been running recently. Historically the stock has momentum from before earnings to after.

ALB could be in a squeeze situation if the stock is higher after earnings, which is a real possibility.

ALB has the 5th highest short position by percent of float in the S&P. and the 15th higher in notional although it is not very large.

Stock and Short Position

Squeeze and Crowded Score

Of the other S&P stocks with high short as a percent of float, the average stock is down 2% where ALB is up 5% QTD. When we look over the year, the average is down 8% and ALB is up down 31%.

This turn around in ALB is why it is a squeeze risk possibility, first the large short position and then the turn around.

The short position has remained constant recently but did rise before that as the stock fell.

Historically the short position and the stock are negatively correlated. That is when the stock goes down the short position goes up as the short investors are following a momentum strategy.

ALB’s positive momentum and high short interest could lead to significant volatility if the stock rises further post-earnings.

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