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For stockpicking contests such as'sBeat the Street game, the goal is not to find the best stocks for the next century but to find the ones that can either snap back this week because of an irrational selloff the week before or explode higher because of some other potential catalyst in the coming week.

With a volatile stock, all you really need is a small glimmer of hope for the shorts to start panicking and the momentum drivers to start piling in. I've used Stockpickr to create another portfolio of stocks that have the potential to move higher this week.

Contest Stocks III

is a portfolio of the top 10 rocket ships for this week.

We at Stockpickr also have updated the list of

Beat the Street Top Stocks

, a list of those stocks that appear most frequently in the top 10 winning portfolios in the Beat the Street stock-picking contest last week.

I gleaned from several portfolios to create my "rocket ship" list:

  • Biggest % Losers, a list of the largest percentage losers, primarily from last Thursday, as I believe the snapbacks will probably happen sometime between Monday and Wednesday.
  • Latest Activist Situations, a list of stocks that could heat up during the coming week thanks to new activist trader activity.
  • Top 20 Most Volatile Stocks on Earnings Day, a list of stocks that historically have gone up or down the most on earnings day. I combined that historical criteria with the stocks on this week's earnings schedule as well as those that have sold off the most this year but that have had good funds accumulating their shares.

One stock that fits that last list of criteria is



. Here's how:

  • Its average stock move on earnings day: 10.44%.
  • It reports earnings after the market close Wednesday.
  • It sells Internet-protocol-based phone services and competes with Cisco (CSCO) - Get Cisco Systems, Inc. Report, which has been scooping up companies through acquisitions. Avaya has found its way onto Who Will Cisco Buy Next?, a portfolio of companies that the networking giant could eventually buy.
  • Avaya also has had a decent run since the bear market began in October 2002, and it's on the Top 25 Stocks Since 2002 Bull Market list.
  • It trades at just 6 times cash flows and has about $900 million cash in the bank, $650 million in cash flows and only a $4 billion enterprise value -- this is just chump change for Cisco and cheap.
  • Its stock is down from a high near $15 in January, as analysts have revised earnings estimates down.
  • Most important, insider buying made by directors has priced around $12.09-to-$12.52 a share.

Another stock I like for the Beat the Street contest is


TheStreet Recommends


. Why? Consider that 24% of its float is short but that one of its largest shareholders is

SAC Capital


SAC is a fund known for its deep investigative style of investing. The "SAC" in its name stands for Stevie A. Cohen, one of the most incredible traders ever. Cohen personally made more than $1 billion last year.

It's SAC Capital vs. the short-sellers on Ionatron, which brings me again to the fact that 24% of the float is short. The reason: The company has a market cap of $450 million but minimal revenue.

That said, the company, which makes laser-based weapons, will have an enormous pop if the government decides on a large purchase of any of its weapons systems. The government could decide any day on several Ionatron products. My guess is it will make at least a trial purchase, a move that would send the shorts scrambling for cover.

Next up is


(AMZN) - Get, Inc. Report

. Here's why:

  • Its average stock change on earnings day: 10.43%.
  • It reports earnings on Wednesday.
  • Among its investors is Hayground Cove, a fund run by former Bear Stearns retail specialist Jayson Ader, who has done well in Jo-Ann Stores( JAS) and Denny's (DENN) - Get Denny's Corporation Report. He's been dipping his toes into the online sector with Amazon.

One of my favorite bloggers, Stockerblog, created an

Amazon One-Stock Portfolio

, which, as you may have guessed, features only Amazon. Stockblog offers a list of positives for Amazon (the numbers reflect where the stock was trading when he wrote this in March):

    Quarterly revenue growth year over year was 33.9%.

    Return on equity is 56.13%.

    Stock has a reasonable price sales ratio of 1.5.

    The stock, which closed at $38.10, is within a couple points of its three-month low.

    The company just began its video download-to-TV service in conjunction with TiVo . Disclosure: I Stockblog do own some TIVO, which I have had for several years. I just can't seem to get away from my stock holdings. Sidenote: Is there a merger in the works between Amazon and TiVo? I checked the headlines for Amazon for the last two days and out of the 20 headlines, TiVo was listed 8 times in the headline, and Amazon was listed once in the headline.

    Amazon's Unbox software is Vista compatible.

    Analysts' opinions are 11 sells versus 6 buys, the worst ratio it's had in the last three months. Out of favor so maybe a contrarian buy now?

    Gross annual profit up 20.4% over the prior year.

    Interest expense has been dropping significantly over the last three years, down 15% in '06 from '05.

    Cash and current assets are increasing.

    Long-term debt is decreasing.

    International sales have increased 28% in '06 versus '05.

    I believe Amazon could surprise to the upside when it reports this week.

    RF Micro Devices


    is another name that could surprise to the upside when it reports earnings Tuesday.

    RF is 30% off of its highs because


    ( MOT), its second-largest customer, has been such a disappointment to everybody. That said, RF's largest customer,


    (NOK) - Get Nokia Oyj Report

    , has announced record unit sales. I bet RF Micro Devices will guide up as a result.

    Check out

    Contest Stocks III

    for the complete list of the 10 stocks I believe could rocket this week. They currently are, I believe, the best ideas for the Beat the Street stockpicking contest.

    At the time of publication, Altucher and/or his fund had no positions in stocks mentioned, although positions may change at any time.

    James Altucher is a managing partner at Formula Capital, an alternative asset management firm that runs several quantitative-based hedge funds as well as a fund of hedge funds. He is also the author of

    Trade Like a Hedge Fund


    Trade Like Warren Buffett

    . Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Altucher appreciates your feedback;

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