Barnes and Noble's Rise Tells its Own Story

Shares of the world's largest book retailer Barnes and Noble BKS have risen 26 percent in the previous two days to $14.33 upon the announcement of the company's new Nook tablet and the Justice Department's opening of a new antitrust probe against Microsoft MSFT. Today's trading volume for Barnes and Noble's shares represents 4.05 times the average volume for the company. The high volume gives validity to the large price move. On Monday Barnes and Noble unveiled its new $249 Nook Tablet, in the company's bid to gain market share in the e-reader and tablet market, just ahead of the crucial holiday shopping season. The announcement comes two weeks after rival Amazon.com AMZN unveiled its new Fire Kindle. Barnes and Noble says that its Nook has more memory and a longer battery life than the Kindle. Staples SPLS also announced it was going to start selling the Nook in its stores, joining BestBuy BBY and Amazon. Landing the company's product on Staples' retail shelves has increased investors' optimism. Meanwhile, shares of Barnes and Noble rival Apple AAPL are down $9.73, or 2.5 percent as the market forecasts sales of the iPad to slip, as the Nook and Kindle gain market share. Also newsworthy is the Justice Department opening an antitrust probe against Microsoft upon prodding from Barnes and Noble. Barnes and Noble saw Microsoft file a slew of frivolous patents in order to stop the development of handheld devices, potentially affecting their new Nook Tablet. Several major analysts have given a "buy" recommendation for the company's shares. Goldman Sachs, Janney Capital Markets, and Stifel Nicolaus have all issued "buy" recommendations for Barnes and Noble Shares. Changes in the company's short ratio also suggests that investors are bullish about the shares. As of October 14, 46.7 percent of the the company's float was held short. That amount has decreased to 37.2 percent today.