Could these be 2 of the hottest turnaround stocks today?

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Qinetiq logo on a jet fighter

Share pickers seeking top turnaround stocks need to take a close look at QinetiQ(LSE: QQ) right now, in my opinion.

Market appetite for the aerospace giant leapt in Friday business following the release of a reassuring pre-close update for the half year (its share price was last 7% higher on the day). In it QinetiQ announced: "Trading has been in line with expectations and the outlook for overall Group performance this financial year is unchanged."

The FTSE 250 firm's Europe, Middle East and Africa (or EMEA) Services division had enjoyed stronger order numbers during the second quarter, it advised, and as a consequence "revenue under contract is as expected at this stage in the financial year." QinetiQ expects modest growth in the year to March 2018, it said.

Meanwhile, over at the company's Global Products arm, trading has been progressing in line with expectations. QinetiQ expects this division to also grow in the current fiscal period "as a result of its contracted orders and pipeline of opportunities, as well as the anticipated full-year contribution from QinetiQ Target Systems."

Global trade picking up

The company's drive to create a truly international company is clearly paying off as it clocked up encouraging business wins during April-September. It sealed a "significant order" for the provision of aircraft launch and recovery equipment for the new class of US Navy aircraft carriers, it said. And it also secured an A$8m order to manage mine warfare maintenance facilities at HMAS Waterhen (in New South Wales) for the Australian Department of Defence.

This was in addition to fresh contract victories back at home. QinetiQ received an £8m order from the Ministry of Defence to provide naval combat systems expertise for Type 26 Global Combat Ship, which was bolted to the existing £110m 11-year Naval Combat System Integration Support Services contract. And it also received a £25m order from Boeing to deliver wind tunnel testing for commercial aircraft development until 2024.

QinetiQ's self-help plan will of course take a little time to fully bed in, as a result, the City expects earnings to slip 7% in the current year before narrowing to a fractional decline in fiscal 2019.

But given the brilliant progress its growth strategy is making so far, and the ample revenues opportunities QinetiQ has looking ahead as defence budgets gradually improve, I reckon the Farnborough firm is an attractive pick right now, and particularly given its low valuations (the share sports a forward P/E multiple of just 14.8 times).

Construction colossus

Watkin Jones (LSE: WJG) is another turnaround stock worthy of serious attention at the moment.

Like QinetiQ, the construction giant is expected to endure a little earnings trouble in the near term, a 42% bottom-line decline is forecast for the year to September 2017. But Watkin Jones is expected to get firing again from the fiscal year beginning next week, and an 11% profits leap is currently predicted.

This leaves the AIM-quoted company trading on a mere P/E ratio of 14.3 times for fiscal 2018. And this also means plenty of upside, in my opinion, as demand for student accommodation in the UK looks set to keep sprinting higher.

Another stock that could make you stinking rich

Watkin Jones and QinetiQ aren't the only London-listed shares waiting to supercharge your investment portfolio, of course.

Indeed, this special report written by The Motley Fool's crack team of analysts identifies what I believe is one of the best growth stocks money can buy.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.