25 Momentum Stocks for the Gambler in You

The second stock on the list, Air T (AIRT - commentary - Cramer's Take), operates in the red-hot air-cargo services space out of its home base in North Carolina. I wrote about larger companies in this space last week. They are some of the leaders of the Dow Jones Transportation Average, companies like Expeditors International (EXPD - commentary - Cramer's Take). Speculators are always looking for small-cap, low-float ways to exploit larger themes, and Air T is their toy.

The company's earnings and revenue growth have supported the move, and its price-to-sales and P/E multiples look fine on the surface at 1.25 and 40. Dig a little deeper, however, and you'll see that, historically, this company has sold for multiples of around 0.5 and around 10, respectively. The chart is rounding into shape at the moment, but from a risk management perspective, it would be a lot better if it either consolidated for another month or dropped 12 points.

W.R. Grace (GRA - commentary - Cramer's Take) is virtually a pure play on expectations that Congress will pass rules in the next session that relieve large industrial companies from much of their responsibilities to asbestos victims. The stock looks pretty cheap right now, has the momentum, and, if you have the stomach for volatility, strength of character to buy on dips, or positive insight into the congressional bill-making process, it should be good to go for the rest of the year.

Jupitermedia (JUPM - commentary - Cramer's Take) is one of the last of the old-time Internet marketing companies that derives its revenue from providing images, research and events to information technology professionals. It is actually covered by three analysts, and its forward P/E multiple of 46 isn't out of line with its projected growth of 36%. It is certainly expensive -- its price-to-sales multiple is 9.8 -- but as a speculative instrument, it is not way out of line. The chart is constructive for further advance through the end of the year.

The StockScouter Winners

Now what about the best-returning stocks with high ratings from MSN Money's StockScouter rating systems? Here are the top 10 for the year.

These should catch a nice bid through the rest of the year, as they have constituencies among both speculative and fundamental players. It's interesting to note that several of these stocks -- Chicago Mercantile Exchange (CME - commentary - Cramer's Take), Tesoro Petroleum (TSO - commentary - Cramer's Take), Tsakos Energy (TNP - commentary - Cramer's Take), Ultra Petroleum (UPL - commentary - Cramer's Take), Autodesk (ADSK - commentary - Cramer's Take) and OMI (OMM - commentary - Cramer's Take) to be exact -- have been on my StockScouter lists all year.

I will track both lists and report back in my year-end wrap-up.

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Please note that due to factors including low market capitalization and/or insufficient public float, we consider Air T, Cenuco, QSound Labs, Terra Nitrogen, Riviera Holdings, Viewpoint, Isonics and Vaalco Energy to be small-cap stocks. You should be aware that such stocks are subject to more risk than stocks of larger companies, including greater volatility, lower liquidity and less publicly available information, and that postings such as this one can have an effect on their stock prices.

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Jon D. Markman is publisher of StockTactics Advisor, an independent weekly investment newsletter, as well as senior strategist and portfolio manager at Pinnacle Investment Advisors. At the time of publication, he held positions in the following stocks mentioned: Ultra Petroleum. While he cannot provide personalized investment advice or recommendations, he welcomes column critiques and comments at [e-mail]; please write COMMENT in the subject line.