What a start to the trading week! Yesterday we saw stocks jump out of the gate, and while volume was light in many instances, most stocks finished the day with nice gains. The Russell 2000 small-cap index gained 2.2% to close at 642, the highest level we’ve seen since January 19th.  The next level of resistance I’m targeting is 660 on the index, and judging by the gains we saw in overseas markets last night, I think the Russell will charge higher today.

Remember Republic Airways (NASDAQ: RJET), the beaten down airline stock we reviewed last week? Last Monday I featured this stock that one of our readers, Patricio, requested I take a closer look at. In that issue of Small Cap Investor DailyI wrote, "The bottom line here is that Republic Airways is cheap, really cheap. Its stock has fallen apart because of industry pressures and a tough economy. But if any positive developments occur, the stock could move higher. I think speculative investors who are comfortable using a bottom-feeder strategy and picking up shares in hopes of a dead cat bounce could profit from Republic Airways." 

Well last Thursday Republic Airways announced that it booked a big one-time gain as a result of the bargain priced acquisition of Frontier Airlines. The company stated that revenue in the fourth quarter rose 88%, bringing full year revenue up to $1.64 billion, an increase of 10.8% over last year. The news sent the stock soaring, and by the closing bell on Friday shares rose 14.5%.  

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