Many investors appear to be quite bearish on Iconix Brand Group, Inc. (ICON), especially if you look at the percentage of the float that is sold short for this stock. Currently, 22.26% of the float is sold short, suggesting an extreme level of bearishness for ICON.
While investors might be piling up against this stock for any number of reasons, it is important to note that ICON has seen some weakness as of late, as the security hasn’t been able to get into positive territory over the past four weeks, losing 1% in the time frame.
Better Trading Ahead?
While the short interest and the recent performance are certainly troubling, there is reason to be optimistic on this stock. Recent earnings estimate activity has actually been quite positive as of late, even in the face of such widespread pessimism.
Thanks to these rising estimates, we actually have a Zacks Rank #2 (Buy) on ICON, so we clearly don’t believe in the negativity surrounding this firm. After all, it is hard not to be at least a little optimistic on the short term when you consider that 1 estimate has moved higher in the past 60 days compared to none lower in the same time frame, while the consensus has also increased.
Given this, a short-covering rally is certainly in the cards for ICON stock, especially if investors embrace the positive earnings estimate revision picture, suggesting that ICON could definitely move higher in the weeks ahead.
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