BALTIMORE (Stockpickr) -- Uncertainty continues to plague investors this week as fundamentals news from the U.K. and Europe has a strikingly negative impact on equities in the premarket. Anxious investors are their own worst enemies right now, as hopes for market stability get scuttled every time marginal news triggers a haphazard selloff. Essentially, the rest of us can expect to see continued volatility until market sentiment cools down -- something that's not clearly happening yet.
But there are glimmers of hope despite the market action we saw in the worst May for stocks since 1940: The AAII Investor Sentiment Index saw bullish sentiment climb 7.3% and bearish sentiment drop 10% since two weeks ago. We'll have to wait to see whether that investor opinion will shake out into the markets.
Until then, we'll continue to use our Rocket Stocks strategy to seek out the best possible gains for this market. If you've never run across them before, Rocket Stocks are our weekly list of beaten-down stocks with near-term growth catalysts and long-term fundamental growth potential. Since I took the helm of Rocket Stocks 46 weeks ago, our list of intraweek plays has outperformed the
index by 59.54% for a total return of 73.02%.
Here's a look at
is having a stellar year that's pushed its shares up more than 30% since the first trading day of January. And that's no surprise given this company's market positioning. With exposure to 35 states through nearly 9,000 stores, this recession-resistant retail play has done a good job of attracting consumer dollars in the past couple of years.
With its upgraded register systems in place, Dollar General now has the ability to seamlessly process everything from EBT cards to credit cards, a feature that's added convenience and options for the store's customers. Despite a significant amount of balance sheet debt, Dollar General is a consistently profitable venture that generates sizable margins and free cash flow -- a factor that should keep the company paying down its borrowings when other debtors are seeing their tightest finances.
This stock could provide relatively instant gratification to a set of investors thanks to earnings slated for today. I expect that Dollar General will be able to deliver some earnings surprise after an especially tough quarter that likely had consumers trading down to DG. Like any pre-earnings play, be cautious about this potential Rocket Stock.
More on Dollar General
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On the other side of the spectrum is
, the computer and mobile device company that introduced its new iPhone 4 yesterday to the excitement of early adopters. Apple's new iPhone (and its accompanying new iOS software, which will be available to older devices later this month) has been a game changing mobile device for the company, and the new iPhone 4 should continue the tradition with exciting new technologies. But while most focus on the gadgets, Apple's continued transition as a service provider should be getting analysts excited.
Apple created the iTunes Music Store in 2003 and has since expanded its offerings to include mobile applications and videos. That foray into digital sales has proven to be extremely successful for Apple, but the company's new iAds platform could be even more so. The mobile advertising platform is seamlessly integrated into iOS and changes the way ads are delivered to consumers, which could significantly change the conversion rates that companies see on their sales pitches.
Despite the fact that iAds hasn't yet launched, Apple has managed to get commitments from some of the world's biggest brands for $60 million in 2010 -- approximately
of the forecasted ad spending on mobile devices. With the company planning on breaking 100 million iOS devices sold as of this month, Apple could potentially become the next ad giant -- and justify its currently high valuation.
Yesterday's upgrade at Goldman sent shares of
more than 6% higher yesterday, following the news that the company's new immune-boosting drug improved the survivability of a brutal form of skin cancer. Cancer drugs have been a big focus for Bristol, which is working hard to push new drug patents into its once-sparse pipeline.
That could pan out to be a big factor for investors, who have been agonizing over the company's patent losses that start next year. While Bristol ramps up R&D, the company is tightening its belt from an operational standpoint, getting ready to deal with the time between major patent expirations and new drug approvals. There's little question that the company will see its financials blemished next year from the expected revenue drop-off, but those risks have already been largely priced into the stock.
This week, we're turning to Bristol for a momentum play. As investors turn their attention to this high-percentage mover, it should get a nice bump in the short term.
For more stocks that made this week's cut, including
, check out the
-- Written by Jonas Elmerraji in Baltimore.
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Jonas Elmerraji is the editor and portfolio manager of the
Rhino Stock Report
, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including
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