Stock Quotes in this Article: ALX, CALM, RCI, TAC

 The following commentary comes from an independent investor or market observer as part of TheStreet’s guest contributor program, which is separate from the company’s news coverage. The opinions expressed are those of the author and do not represent the views of TheStreet or its management.

SAN FRANCISCO (Stockerblog) -- Investors in dividend-paying stocks might want to take a different approach to looking for stocks. Many stock traders look for short-squeeze plays . These are stocks that have a large number of shares that have been shorted. Traders are hoping that on any good news, the short-sellers will jump at buying in their shares, driving up the stock's price.

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    Short interest in a stock could indicate that the stock is well positioned for a short squeeze in the event a positive catalyst occur. A short squeeze takes place when a heavily shorted stock is quickly bought back in by the short-sellers in order to cover their bearish positions, driving the price of the stock up sharply. The most common measurement for short interest is the short ratio, which measures the numbers of days it would take the short-sellers to cover their positions based on recent average daily volume.

    Surprisingly, there are several high-dividend stocks listed on some of the high-yield lists at WallStreetNewsNetwork.com that have been heavily shorted.

    For example, Rogers Communication (RCI), the Canadian media company that yields 3.9%, has a days-to-cover ratio, or short interest ratio, of 62.8. This means that if the short-sellers decided to cover, it would take them almost 63 days to buy in their shares, based on the current daily volume of the stock. Rogers trades at 10.6 times forward earnings.

    The egg distributor Cal-Maine Foods (CALM), has a short ratio of 27.1 and yields a generous 6.4%. The stock carries a forward price-to-earnings ratio of 15.

    TransAlta (TAC) is a nonregulated electric utility that generates electricity from coal, natural gas, hydroelectric, wind, geothermal and biomass that yields 5.6%. The stock has a short ratio of 29.4 and a forward P/E of 17.

    Real estate investment company Alexander's (ALX) has a yield of 2.9% and a short ratio of 29.8. The stock trades at 32 times earnings.

    For free lists of high-yield stocks, which can be downloaded, sorted, and updated, go to WallStreetNewsNetwork.com.

    At the time of writing, author had no positions in stocks mentioned.

    Fred Fuld III, the publisher of stock and bond investing blog Stockerblog and founder of WallStreetNewsNetwork, has been in the financial services industry for over 20 years, working as an investment advisor, options market maker at the Pacific Stock Exchange, vice president of a San Francisco money management firm, university faculty member and wholesaler for the New Alternatives Fund (the first environmentally conscious mutual fund). He is the author of the books Investing in Brazil Stocks and The Green Light on Green Stocks.