10 Stocks to Shake the Market

• Email
• Share
• Print

In music, they're called one-hit wonders: singers or bands who can never quite regain the magic of their singular big success. Think Norman Greenbaum's "Spirit in the Sky" or Brownsville Station's "Smokin' in the Boys Room," monster hits never to be repeated.

We have seen similar one-hit wonders in stocks, too, like Pets.com or drkoop.com. Many companies that burst on the scene during tech bubble heyday never lived up to their initial promise.

Whole lotta shakin' going on
While nostalgia's fun, "10 Stocks to Shake the Market" isn't about finding stocks that can't repeat their success -- it's about discovering stocks with at least one big move already under their belts, and the promise of more to come.

We're looking at 10 stocks that made some of the biggest upward leaps over the past month. We'll then pair that list with the ratings issued by our Motley Fool CAPS community. The higher their ratings, the greater CAPS investors' confidence that these stocks will keep moving higher and beating the market.

Stock	30-Day % Change	CAPS Rating
NOVA Chemicals (NYSE: NCX)	210.6%	****
SiRF Technology	71.6%	****
Ivanhoe Mines	65.6%	***
Skyworks Solutions	63.7%	***
MF Global (NYSE: MF)	55.2%	***
Smith & Wesson (Nasdaq: SWHC)	53.8%	****
Cabela's (NYSE: CAB)	44.7%	***
InterOil (NYSE: IOC)	38.7%	*
Buffalo Wild Wings (Nasdaq: BWLD)	32.9%	***
ClickSoftware (Nasdaq: CKSW)	26.9%	*****

Source: Motley Fool CAPS.

With only one of the stocks carrying a top rating, let's see why the CAPS community thinks any of these might outperform the market.

A mighty temblor
Did fear of further restrictions on the right to bear arms cause gun sales to soar in the fourth quarter? Analysts suggest that gun enthusiasts' worries about a new administration and Congress, potentially more hostile to gun rights than its predecessors, helped push Sturm, Ruger & Co.'s sales 81% higher in the fourth quarter. FBI background checks for firearms purchasers also jumped 29% in January.

Smith & Wesson's second-quarter earnings from last December seem to bear that theory out. The company reported a 40% rise in pistol sales in the quarter, while hunting-rifle sales dropped 41%. Sporting goods retailer Cabela's also benefited from the renewed interest in firearms, recording a 7% increase in retail sales in the fourth quarter -- and its first jump in comps in over a year -- on the strength of gun sales.

Unfortunately for investors, I suspect that the benefits to gun sellers are only fleeting. Sales may shoot higher for a time, but if the analysts are correct, it's only a matter of time before new regulations come down and sales falter once more.

Top-rated CAPS All-Star abitare would seem to agree that any benefit accruing to Smith & Wesson won't last forever. Right now, though, concerns about the economy make a credible case for a short-term buy:

Anyone, who has tried to buy ammo lately, or been to a gun show knows the "consumer is not dead". I think the guns, gold, silver, and ammo story "has legs". Gold and silver are up 300% since 2001, but SWHC has fallen from $21 to $2.50. I do not think SWHC is a great company or at a good PE. But I think the story will work and there are not many publically traded gun and ammo makers left

Shake, rattle, and roll
With these stocks shaking the market this past month, it pays to start your own research on them at Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made all from a stock's CAPS page.