For instance, in the most recent quarter, the company was able to 7.4 million of its flagship Lumia phones. Bears will argue that the company still fell shy of estimates by 700 thousand phones. Though this may be true, the 7.4 million still represents a 32% increase from the first quarter. Another thing; Nokia's loss of 227 million euros was 20% better than the expected loss of 276 million euros.

I'm not ignoring the reality that this company still has plenty of work to do. Returning value to shareholders is not going to happen overnight. But you don't have to look too far to see that the company is on an uptrend. More importantl, investors no longer have to question whether Nokia deserves consideration as a good turnaround story. Management is authoring a new chapter.

If things continue to progress as I expect they will, by this time next year this stock will disqualify itself as a candidate for best stock under $5. Within two years, it will struggle to stay under $10, which will be a great thing for investors.

Sell Advanced Micro Devices ( AMD)

Next on our list is Advanced Micro Devices, which is currently trading around $3.70 per share. On May 13, I told you that the stock was overbought. There was just too much optimism for a company that I thought was performing average at bests. Now, let's remember that I recommended it as a sell while the stock was trading at $4.17 as the stock had made five new 52-week highs within a span of two weeks. In that article, I said the following:

"I don't see a compelling reason to buy the stock at these levels. What's more, since November 16 of last year, when AMD reached a $1.81, the stock is now up more than 120%. Again, while there are signs of improvement, these shares might have already reached their expected highs for the year.

If management can execute and return the company to profitability then the stock may have some more legs, but at this point I think the safer play here is to take your profits and wait and see what the next quarter brings."

I remember being attacked by readers in the comments section, poking fun at my quote where I suggested that "Games aren't going to cut it." My point was despite AMD's weakness in the chip business, the company decided to bet heavily on the gaming industry - making chips for Microsoft's ( MSFT) Xbox One console and Sony's ( SNE) PlayStation 3.

I also questioned management's aggressive growth strategy, which would come at the expense of profits. I didn't trust that this was the right play given the deficits that AMD has had to work with. Well, these issues (among others) came home to roost in the company's second-quarter earnings report.

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