By Stockpickr Staff
Posted on May 18, 2009


The inevitable pullback finally occurred last week as profit-taking in the financials, oils and technology lead the market lower.

There are several Rocket Stocks trades for this week, so let’s jump right into it.

AirMedia Group (AMCN), long ahead of earnings: Second derivative plays on China are extremely hot right now, and AirMedia Group should be no exception once it reports earnings this week. As intermodal travel picks up in China domestically, companies such as AirMedia are poised to capture the recent increase in domestic traveling.

Just recently, AirMedia signed an advertising agreement with Sinopec, one of China’s largest exploration and production oil and natural gas companies. According to the licensing agreement, AirMedia will install its digital TV screens in up to 1,000 Sinopec gas stations this year, and it plans to have a nationwide network in 8,000 service stations by 2015.

Currently, AirMedia reaches more than four-fifths of all Chinese air passengers through its network of 2,500 digital TV screens across more than 40 national airports. Air travel companies such as Ctrip.com (CTRP) have recently reported impressive quarter-over-quarter and year-over-year increases, another potential catalyst for AirMedia.

PetSmart (PETM), short ahead of earnings: Despite solid earnings from PetMed Express (PETS), PetSmart operates as a standard retailer and is subject to the typical consumer headwinds that have crippled the sector recently. PetSmart has only $126 million dollars in cash but more than $630 million dollars in debt, with debt in the capital structure representing almost 20% of the company.

For more ideas, including ATP Oil & Gas (ATPG), Goldman Sachs (GS) and Potash Corp. (POT), visit this week's Rocket Stocks portfolio.