Stocks To Keep Your Eye On - 08/24/2007

- (ANN)/.48
- (BKC)/.27
- (HNZ)/.55

Aeropostale Inc. (ARO) The mall-based retailer of clothing for young men and women forecast a per-share profit in the third quarter of 43 cents to 45 cents. The average estimate from seven analysts surveyed was 47 cents a share. Aeropostale shares fell 56 cents to $23.12 in regular trading yesterday.

Aircastle Ltd. (AYR) CNBC ``Mad Money'' host Jim Cramer said shares of the commercial-aircraft leaser have been depressed by credit issues that don't really harm the company. Aircastle shares fell 76 cents to $31.19 in regular trading yesterday.

Arcelor Mittal (MT) rose $1.93, or 3.2 percent, to $61.53 in trading before U.S. exchanges opened. The world's largest steelmaker was raised to ``buy'' from ``neutral'' at Merrill Lynch & Co., which said steel prices and demand are rising.

Gap Inc. (GPS) The largest U.S. clothing retailer increased its full-year profit forecast and said it would repurchase an additional $1.5 billion in shares, including some held by Gap's founding Fisher family. Gap fell 8 cents to $17.40 yesterday.

NovaStar Financial Inc. (NFI) The mortgage company said it obtained a waiver from lender Wachovia Corp. so that a downgrade of the company's debt rating by Moody's Investors Service won't trigger a default. NovaStar rose 45 cents, or 5 percent, to $9.53 in regular trading yesterday.

Watch FCN, CMG, ZNH, SAM for long breakouts.
Watch WMT, GS, MCO, BSC, MHP for short breakdowns.

Here are the 25 NYSE stocks with the largest percentage increase in their short interest relative to their float from mid-July through mid-August:

1. Novastar Financial (NFI, +25.2%)
2. Beazer Homes USA (BZH, +16.2%)
3. RAIT Financial Trust (RAS, +14.0%)
4. ACA Capital Holdings (ACA, +12.2%)
5. Goodrich Petroleum (GDP, +11.4%)
6. Radian Group (RDN, +10.7%)
7. Redwood Trust (RWT, +10.4%)
8. Alesco Financial (AFN, +10.3%)
9. MGIC Investment (MTG, +10.2%)
10. FirstFed Financial (FED, +9.9%)
11. Capital Trust (CT, +9.7%)
12. Primus Guaranty (PRS, +9.3%)
13. McMoRan Exploration (MMR, +8.9%)
14. IndyMac Bancorp (IMB, +7.3%)
15. WCI Communities (WCI, +7.0%)
16. Federal Agricultural Mortgage (AGM, +6.6%)
17. Resource Capital (RSO, +6.4%)
18. Bluegreen (BXG, +6.1%)
19. Countrywide Financial (CFC, +5.9%)
20. Newcastle Investment (NCT, +5.8%)
21. iStar Financial (SFI, +5.8%)
22. Gramercy Capital (GKK, +5.7%)
23. Best Buy (BBY, +5.7%)
24. Fortress Investment Group (FIG, +5.6%)
25. Mueller Water Products (MWA, +5.4%)

-MM