Some stocks are one-hit wonders, making a big splash when they first appear, then quickly fizzling into obscurity or oblivion. But for other stocks, that initial big move is only a preview for even bigger and better gains.
Today, we've listed three stocks that made some of the biggest moves up over the past month, which we'll pair with the ratings issued by our Motley Fool CAPS community. The higher each stock's rating, the greater CAPS members' faith in that company's ability to keep on beating the market.
|
Stock |
1-Month % Change |
CAPS Rating (out of 5) |
|---|---|---|
|
Nanometrics |
54.5% |
* |
|
McAfee |
42.1% |
** |
|
Dynegy |
38.2% |
**** |
One-month % change from Aug. 2 to Sept. 2.
As the markets whipsaw to changes in second-half economic performance, the S&P 500 has been volatile. So before we get shaken out again, let's see why the CAPS community thinks some of these companies might continue to outperform the market.
A mighty temblor
With Intel predicting the second half of 2010 will be rather slow, it sort of makes sense that it would use recent market weakness to try to buy its way to growth. Not only did it announce its plan to purchase security specialist McAfee, it also bought the mobile chip business of Infineon Technologies to give it a larger presence in telecommunications.
The McAfee purchase also gives the chip maker a way to derive further gains from Advanced Micro Devices
The manufacture of chips, whether used in computers, solar photovoltaic panels, or LEDs, requires precise control measures to improve efficiency and yields. Nanometrics is a control metrology specialist that has surprised analysts with its resurgence (though not some in the CAPS community, who earlier this year figured it could engineer a turnaround).
Once again, though, doubters will point to two signs that Nanometrics' growth trajectory could ease off in the near future. There are Intel's warnings, as well as advanced wafer-test equipment shop FormFactor
Almost two-thirds of CAPS members rating Nanometrics still think market-beating performances are in its future, but you can add your own opinion on its future on the company's CAPS page.
A speedy opportunity
Mergers and acquisitions activity was also behind Dynegy's rise for the month because private equity giant The Blackstone Group offered to buy the utility for $4.7 billion including debt. The power industry is attracting a lot of buyers with money, as FirstEnergy
But is there a better offer on the horizon for Dynegy? At $5.10 a share, the stock is trading at a 13% premium to Blackstone's offer, suggesting some investors might think there could be a bidding war. That's not puccini3005's view. While admitting to more wrong calls than right ones on Dynegy, the CAPS member doesn't see a better bid coming through and thinks the utility's shares will eventually fall back to the offer.
Analysts doubt a better offer will come, too. Although those offering initial speculation suggested Blackstone might increase the equity portion of its bid because it would simultaneously be selling four of Dynegy's natural gas-fired plants to NRG, thus reducing its own costs, analysts say the deal has been structured to prevent Blackstone from piling debt onto Dynegy and it's going to need that cash.
Give us your view of the deal and the prospects for a higher offer on the Dynegy CAPS page.
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.
