Among the biggest winners in Wednesday’s early trading are Solarfun Power (Nasdaq: SOLF), Hercules Offshore (Nasdaq: HERO) and U.S. Airways (NYSE: LCC).

Solarfun Rebounds

We took a look at Solarfun Power (Nasdaq: SOLF) last week as shares were slumping to new lows. At the time, it looked as if investors had lost all faith in this and other solar names, focusing solely on the near-term challenges instead of the long-term opportunities. Well, Solarfun insists the near-term isn’t all that bad, either. The provider of solar power equipment posted first-quarter profits on Wednesday that were more than double the forecasts. Equally important, management boosted full-year sales guidance, which refutes the notion that demand in the sector has fallen off a cliff. And that’s good for a +13% pop in shares this morning.

But it may be time to book quick profits if you picked up shares in last week’s sell-off. That’s because investors are likely to question whether the all-important German market will drag down sector results later this year when solar subsidies expire. Make no mistake: this is a stock and a group to own for the long-haul, but there is just too much cynicism about the short-term.

Action to Take –> You need to be nimble with this whole group. These stocks rise and sink fast, and it’s proven to be wise to sell into rallies and buy into dips. Right now, they are in rally mode. If you hold a long-term view, sector valuations look quite compelling, and these stocks can be bought and held.

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Bottom-Fishing among the Drillers

With all of the uncertainty surrounding the long-term impact for Gulf Coast drilling, a wide range of firms providing drilling equipment and services have sold off sharply in recent sessions. Yet they are posting a heady rebound today, as investors try to find which names have been oversold. For example, shares of Hercules Offshore (Nasdaq: HERO) are up roughly +7% after losing nearly -40% of their value since late April. Other beaten down-names such as Seadrill (Nasdaq: SDRL), Rowan (NYSE: RDC), and Pride International (NYSE: PDE) are all up in the +3% to +5% range.

#-ad_banner-#But it seems too early to sound the all-clear on this group. Over time, the industry will be back on its feet, probably after additional safeguards are put in place to avoid a repeat of the current catastrophe. But in the near-term, virtually all new permitting efforts are likely to be on hold, and investors should brace for possibly lowered guidance from a number of these firms as the second quarter proceeds.

Action to Take –> This is purely about time frames. Many of these stocks are off -30% or even -40% from their peaks, and will likely be back at their current 52-week highs in a few years. But in the near-term, the negative news on the group will likely continue, especially since the Obama administration is feeling the heat to get tougher on this industry. So buy for the long-term promise, not the short-term gain. However, as a minor caveat to that view: if BP (NYSE: BP) is successful in this week’s efforts to stanch the flow of leaking oil and gas, the whole group could see a powerful relief rally. But if the recent past is any guide, there is not a high degree of optimism for the current well-capping efforts.

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U.S. Airways Continues to Rise

Shares of U.S. Airways (NYSE: LCC) posted strong gains Tuesday on the heels of an analyst upgrade, and they are rising another +10% today. At around $8.50, shares still lag the $11 price target offered by JP Morgan. The boost in the target price comes after oil prices have steadily fallen. U.S. Airways had neglected to protect itself with fuel price hedging, and thus will see the biggest drop in expenses from oil moving below $70.

The move underscores how the whole airline industry is hostage to oil prices. When oil moved past $100 a barrel a few years ago, many carriers moved into the red. Conversely, when oil prices slump sharply, it’s a sign that global economic concerns are dominant. So oil below $50 a barrel usually means that demand for air travel is weak. Right now, oil prices are in a “Goldilocks” phase.

Action to Take –> Airline stocks can prove to be a bit dicey right now. Many carriers derive a decent chunk of revenue from European routes, and as Priceline (Nasdaq: PCLN) recently warned, global air travel looks set to slow down. In contrast, the U.S. air travel market looks fairly healthy. And that favors U.S. Airways, JetBlue (Nasdaq: JBLU), and Southwest (NYSE: LUV), which have very little international exposure. In light of Europe’s nascent crisis, these domestic-focused carriers are the names to own right now.