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Last week, I was very satisfied with the way my "5 Stocks To Watch" article performed. The S&P 500 traded lower by 1% and only one of my five stocks traded lower, with Alcatel-Lucent, Rite-Aid, and Celldex Therapeutics all breaking out. Now, with the market becoming more unpredictable with wild 100-point Dow Jones swings, I am trying a different approach.

In all of my previous posts I have followed a strategy that I outline in "The Key To Creating Large Gains", which resulted in my selections outperforming the S&P 500 by six to one. In this piece, I am mostly looking at short-term catalysts, in hopes that these catalysts can catapult these five stocks in the week ahead. Therefore, let's get started!

An Attractive Pre-Earnings Price

After a very rapid 20% gain to start 2013, shares of FedEx Corporation (NYSE:FDX) traded lower by 5% after reporting FQ3 earnings. In the report, revenue grew 4% year-over-year (beating expectations) but the company was short on EPS. Moreover, the company issued FQ4 EPS and FY2013 guidance that was below consensus, which aided in the stock's decline.

Overall, FedEx's quarter was not that bad - but the stock went too high too fast to start the year. Now, after disappointing guidance, it seems as though bad earnings are baked into the price of the stock. The stock is currently trading at the same price that it closed on after reporting its disappointing quarter.

Next week, on Wednesday, FedEx will report earnings, and is expected to post $2.00 per share, and I think it will beat expectations. Last month we saw global air freight rise 1.2%. Air freight has been a weakness for FedEx as demand fell 1.5% last year. Moreover, I think updates on the company's new USPS deal could provide a boost to the stock, as its contract to provide air transport services was better than expected.

Overall, I think there's a lot to like when FedEx reports earnings on Wednesday. I think expectations have been lowered and that the stock could very well trade higher. Granted, FedEx is not going to see a 10-15% move higher, but I think a solid 3-5% weekly return is possible; that is if earnings are strong. Either way, it's a stock I would watch closely both this week and in the weeks ahead.

The Comeback Quarter To Push Shares Higher

Much like FedEx, Oracle (NYSE:ORCL) posted a very disappointing quarter back in March, pushing its stock lower by 7%. The good news is that over a six year period of time, Oracle is yet to post two consecutive quarters where it misses expectations - and the company is scheduled to release earnings on Thursday.

Looking back, Oracle stated that its missed quarter was due to deal push-outs and sales execution rather than macro conditions. In fact, Oracle said that the macro environment remains unchanged. Moreover, the company introduced new M5 and TS servers, which the company said are up to 10x faster than previous generations with 12 times the cost performance advantage. These releases will affect its hardware business, a space that fell 23% year-over-year during its last quarter. It will be interesting to see if there are any fundamental changes from these releases and if the company boosts guidance due to increased demand.

Currently, the stock is trading at just 11.5 times next year's earnings, and I think it is very likely that we see strong performance from the tech giant when it reports on Thursday. Much like FedEx, don't expect a 10-15% pop, regardless of earnings - but a small 2-5% gain could likely occur if its hardware business is solid.

This Stock Keeps Rolling Higher

Micron Technology (NASDAQ:MU) has been an interesting stock to follow over the last couple of years. In 2012, it did practically nothing but trade flat. In 2011, we saw large losses of 20% -- but in 2013 the stock has exploded with gains of more than 100%.

Much of its gains in 2013 has been tied to the ongoing acquisition of the bankrupt Elpida and the growth it will create, but also improving demand for its products. Micron, along with Samsung and SK Hynix, control 90% of the DRAM market, and during this year, DRAM spot prices are up over 100% while contact prices are up over 70%.

During Micron's last quarter, the company posted strong performance from both its DRAM and NAND product lines. The company stated that supply and demand is strong, with demand for NAND increasing despite a slowed manufacturing process, meaning higher prices. With all things considered, I think just about everything possible is going in the favor of Micron Technology, both macro and what the company can control. Thus, I'd watch the stock on Wednesday to trade higher, because with the level of momentum present, it could see considerable gains.

Telecom Capex Could Push This Stock Higher

I'm watching Finisar Corporation (NASDAQ:FNSR) more-so than any other stock next week, expecting it to trade higher after earnings on Wednesday. The company develops and provides fiber optic subsystems and network performance test systems which enable data communications over local area networks, or LANs, and storage area networks, or SANs. It is one of many companies that is deeply connected to telecom as a supplier, but also operates in other industries as well.

Finisar last reported earnings in early March, which was a mixed report. The company's top and bottom line were in-line with estimates, but expectations of increased CAPEX led many to believe that future guidance would be bullish. Instead, the company's guidance was somewhat weak. This guidance was in part due to concerns in its telecom operations, as pricing and wage pressure continue to be major issues.

Now, the reason I am bullish is because of what all have occurred since the company announced earnings. Finisar had traded lower mostly due to weak telecom operations and also lower CAPEX spending by AT&T. However, in April, Infinera posted a very strong quarter noting strong demand. In June, Ciena posted an incredible quarter, and said that Web/mobile traffic is causing telecom CAPEX to increase regardless of whether the telecom companies want the higher costs or not. Moreover, the fact that 31% of Ciena's sales come from two customers (AT&T and Verizon) paints a pretty picture for those companies that benefit from spending among U.S. telecoms. Therefore, with Finisar's last update back in March, and other telecom related suppliers/vendors performing well, I'd watch for the company to surprise analysts and trade higher on Wednesday.

Continued Gains After A Superb Quarter

So far, all of my selections have been companies that report earnings next week, but my final is one that reported last week: Restoration Hardware (NYSE:RH). Back in late-April and early-May, I selected Restoration Hardware twice in this series, as I was watching for a second pop. On the last day of its second week being included in the series, it rallied from $40 to $48. Now, the stock is trading at $68.50 and I believe it has yet more room to run higher.

This last Friday shares of the company traded higher by 16%. The large gains were in response to earnings, where the company grew revenue and comparable sales by 38% and 41%, respectively. In addition, the company increased both full-year and Q2 guidance. The reason that these gains are incredible is because the company has not expanded any of its stores, it still has 71 total.

Restoration Hardware is one of the fastest growing companies in retail, and has returned gains of 120% since its IPO in November 2012. Despite these large gains, the company still trades at just 1.8 times sales. Furthermore, it has operating margins of under 2.5% for the last 12 months, roughly one-fourth of Home Depot. Thus, this is a company that has significant room for improvement, one that I believe could double in price and still be attractive due to its unprecedented comparable store sales growth. Up until this point, it has remained under-the-radar, but after this strong quarter, I would not be surprised to see it trade higher next week as more investors buy for the long term. Simply put, this company is too good to trade at multiples that are even remotely close to that of Home Depot or Lowe's.

Conclusion

I previously used to trade stocks before earnings, and luckily I experienced a great deal of success. However, buying a stock before earnings is very risky, as stocks often trade illogically and may incorrectly produce loss or gains. Therefore, I think the best time to play earnings is right after earnings, but only if a stock trades illogically. The easiest way to determine whether a stock is trading illogically is to first read the company's quarterly report and listen to the conference call. Then, make an assessment based on that information as to whether or not the quarter was good or bad. If the quarter was good and the stock traded lower, then almost always it is presenting value and will appreciate. With that said, if you are looking for short-term gains, then I do believe that each of the stocks on this list are attractive. Each have a favorable trend, and with the market trading so volatile, a company catalyst is about the only thing that can produce decent gains. Thus, I suggest exploring these stocks further, while understanding that buying before earnings is risky. If you determine the risk is too great, then try my advice, read the report, and then seek value when the stock trades without reason.

Source: 5 Stocks To Watch For Gains Next Week