Abercrombie & Fitch Co ANF 8.11% shareholders were treated to a nice surprise 7 percent gain on Thursday’s open after the company reported fairly lackluster Q4 earnings before the open.

Abercrombie reported Q4 EPS of $0.71 on sales of $1.04 billion, short of consensus expectations of $0.75 and $1.05 billion, respectively. In addition, the company reported a Q4 same-store sales decline of 5 percent for the critical holiday shopping season.

Yet despite the luke-warm quarter, Abercrombie shares are on fire on Thursday morning, a move that Standpoint Research analyst Ronnie Moas attributes to a short squeeze.

“Looks like shorts – 18 mln shares short—are getting squeezed this morning,” Moas wrote in a note to clients. “ANF up 6% in pre-market trading is trading at 0.2X sales, but they are currently struggling to break even in a difficult industry.”

Moas notes that foreign exchange rates have weighed on Abercrombie’s performance in recent quarters and expects the situation to improve somewhat in the second half of the year.

According to shortsqueeze.com, Abercrombie’s short percent of float is…

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