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Traders: These heavily shorted stocks could rally

Using short interest to trade? 4 names to think about
VIDEO2:0602:06
Using short interest to trade? 4 names to think about

A few heavily shorted stocks have rallied this year, and some "Fast Money" traders believe those names could keep climbing.

Short sellers have taken interest in shares of Tesla Motors, Under Armour and Darden Restaurants, all of which are up for the year. Traders said those stocks' success could continue.

Alexis Georgeson | Tesla

Tesla

Tesla shares rose nearly 4 percent Wednesday in the wake of strong orders for its new Model 3 vehicle. The electric automaker has now received at least 230,000 reservations for the car.

CEO Elon Musk said this week on Twitter that shorting Tesla is "probably unwise." Trader Dan Nathan believes the stock may continue to rally.

It has climbed 10 percent this year.

Elon Musk, CEO of Tesla.
Tesla short interest hits record high

Under Armour

Under Armour shares are up 6 percent this year. Trader Pete Najarian contended the company's growth potential could drive the stock even higher.

"There's all kinds of reasons why it makes a lot of sense right now," he said.

Darden Restaurants

Trader Guy Adami expects a rally for Darden Restaurants, which reported quarterly earnings and revenue this week that topped expectations.

"I thought it was a pretty good quarter," he said.

Its stock has risen 2 percent this year.

Disclosures:

Pete Najarian

Long AAPL, BAC, BMY, DIS, DISCA, DVN, GE, KMI, KMI.A, KO, LUX, MRK, PEP, PFE, SAVE. Long Calls: AAL, AAPL, AGN, AKS, AMJ, BAC, BAX, CL, COP, CRM, DAL, EBAY, ECA, EGO, GE, GRPN, HAIN, IBM, KO, KSS, LC, MDLZ, MET, MS, MSFT, NLNK, POT, SCHW, SLW, SLV, SPG, TCK, UAL, WYNN, XOM, YHOO, ZIOP, EWZ, GDX. Long Puts: HES, PMR, RY, VLO

Brian Kelly

Brian Kelly is long BBRY, Bitcoin, GLD, GLD puts, SH, SLV, TLT, US Dollar, UUP, Yen; he is short Aussie Dollar, BLK, British Pound, CS, DB, Euro, EWH, FRC, Hong Kong Dollar, UBS, SPY, Yuan, 5-Year Note Futures

Dan Nathan

Dan is long AAPL April Put Fly,long TWTR, long GE May 28 puts, long JPM April puts, long INTC April puts , long QCOM April put spreads, long HYG June puts, long IWM May and September puts, Closed TSLA long april/june put spread, long XHB June put spread, long XLE April/June put spread

Guy Adami

Guy Adami is long CELG, EXAS, GDX, INTC, Guy Adami's wife, Linda Snow, works at Merck.