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Troika Media (NASDAQ:TRKA) is trending on Tuesday as shares of TRKA stock fall more than 25%. The pullback is not what investors were looking for, given the stock’s high short interest and recent earnings report.

That said, it is a tricky market environment right now. The S&P 500 is under notable selling pressure on Tuesday, as bets on interest rates continue to call for higher rates. This has investors in a “risk-off” mindset, which we’re seeing reflected across the board. That goes for TRKA stock, too.

If you haven’t heard of Troika Media Group before, don’t beat yourself up. Shares opened today’s session at 92 cents and traded as high as 99 cents per share. However, a sub-$1 penny stock doesn’t tend to command all that much attention. Further, the company sports a market capitalization of just $40 million.

Shares rallied almost 50% on Monday and at one point were up 29.3% today. This put the short squeeze discussion in full motion. However, TRKA stock has since reversed to the downside. At one point, shares were down 56% from the session high.

Can TRKA Stock Trigger a Short Squeeze?

Part of the initial gains today were likely fueled in part by Troika’s earnings results. Before the open, the company announced results for the six months ended Dec. 31, 2022. Troika announced “adjusted EBITDA of approximately $5.0 million” and a “revenue increase of 1125% over the comparative prior year period.” The company also reported:

“The operational changes and record business performance during this six month transition period were delivered ahead of schedule in what was an aggressive timetable to alter the strategic course of the Company. In the last nine months, we repositioned the business, delivered successive record-breaking revenue, diversified our revenue sectors, and implemented changes to optimize operational efficiency.”

According to Fintel, TRKA stock has a short interest of just over 43%. So, when traders combined several factors — including Troika’s sub-$1 price, market cap, high short interest and recent earnings report — there were reasonable expectations that these factors could trigger a larger upside squeeze.

Not to play the contrarian side too hard, but perhaps TRKA stock has already enjoyed its short squeeze. The stock is working on its fourth-straight weekly gain. Further, over the past month, shares have enjoyed a 465% rally from the low to the recent high.

That’s more than a five-fold return in just one month. Still, it would do TRKA a load of good to get a close back above $1 per share.

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On the date of publication, Bret Kenwell did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.