Recent price: $4.06 This maker of wind turbines deserves a mention, albeit short (I profiled this company in more detail here and here ). The abrupt end of a large and profitable relationship with Chinese wind-power provider Sinovel has led to a sharp drop in the company's results. But just-released quarterly results show a 30% sequential jump in bookings as the company lands new customers. A lawsuit that seeks $1 billion in damages from Sinovel could be a game changer for the company, which is valued at just $230 million. I dont' have a precise price target yet because there are too many variables right now -- where the stock goes depends on the outcome of the lawsuit with Sinovel, backlog growth and the move back to profitability. But it's definitely worth monitoring it to see if business rebounds. Risks to Consider: Small-cap stocks only rebound when investors grow confident that the bottom of an economic cycle is only a quarter or two away. Right now, it's too soon to tell what the U.S. economy will look like in 2012. Action to Take: These five stocks represent a cross-section of industries -- transportation, health care, clean energy, education and retail. As such, they may be best bought as a basket of stocks in order to remove company-specific risk and merely play the "economic cycle" angle. One large gainer among them can help energize the whole basket, since some of these stocks can rise more than 50%. >>To see these stocks in action, visit the 5 Small Stocks With Home-Run Potential portfolio on Stockpickr. Disclosure: Neither D. Sterman nor StreetAuthority, LLC hold positions in any securities mentioned in this article.
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