NEW YORK ( TheStreet ) -- Several high-tech small cap stocks rose to the top of my Emerging Growth buy list this month after racking up impressive gains in the last four weeks. These companies may not have the largest market cap, but they all have great upside in the month of October. And they're all set to be the standout winners this earnings season. Make sure you pick up shares of these companies before they release earnings. Here are five small-cap stocks to buy now.
1. Valeant Pharmaceuticals International
Valeant Pharmaceuticals International ( VRX) develops drugs for a variety of illnesses and ailments, including epilepsy, Parkinson's disease, migraines and acne. But Valeant has changed a lot. It recently completed a merger with Biovail, the largest pharmaceutical company in Canada. Even though this was marketed as a merger, it was structured as a buyout as if Biovail is buying the old Valeant. Valeant stockholders will receive, for each share of VRX stock held prior to the merger, 1.7809 shares of Biovail (after the merger, the combined company changes its name to Valeant). In addition, the company will issue a one-time dividend of $16.77 per share to every old Valeant shareholder of record as of Sept. 27. During the past several months, Valeant Pharmaceuticals and Biovail rallied in tandem as their merger was being finalized. Since September, VRX has gained 11%. VRX will announce earnings for the third quarter sometime in early November. Analysts are expecting earnings of $0.81 per share, an increase of nearly 20% from the previous quarter and sales of $297.1 million, a 25% year-over-year increase. I predict this stock will surge as we near its report, so continue to buy VRX while it remains under $28 per share.
2. Acme Packet
Acme Packet ( APKT) is a communications equipment company that witnessed a surge in institutional interest in the third quarter as institutional investors increased their holdings of the company's stock by nearly 25%. The reason institutional investors, including banks, financial advisories and mutual funds, have become so interested in APKT is because of earnings. Analysts are predicting earnings of $0.19 per share on sales of $54.9 million. Compared with last year's results, the data represents a 111% earnings increase and a 51% sales increase. In all likelihood, actual results will come in even higher as analysts aggressively have been revising these estimates higher in the past several months. APKT itself even raised its yearly forecast in its most-recent quarterly financial report.