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 to come.
Today, we've listed three stocks that made some of the biggest upward moves 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.
(out of 5)
|Majesco Entertainment (Nasdaq: COOL )
|VirnetX (NYSE: VHC )
|Adeona Pharmaceuticals (NYSE: AEN )
^ Change Feb. 24 to March 23.
While you were out, the market plunged below the 12,000 level and soared back up, 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
The video game industry might want to thank Microsoft (Nasdaq: MSFT ) for adding manna to sales. Its Xbox 360 and Kinect motion sensor device increased interest in the space again. It was a hot seller for Christmas and Microsoft recently said it shipped its 10 millionth Kinect unit. The market researchers at NPD Group said the Xbox was the best-selling video game device in February, which helped boost console sales 10% that month.
Nintendo is enjoying a resurgence, too. It's Wii console remains as popular as ever while its next-generation handheld device, the 3DS, set a record for one-day sales. That's good news for Majesco Entertainment, which is coming off a stellar first quarter that saw sales rise 66% and margins widen on the strength of Zumba Fitness, the Brazilian aerobic exercise program for the Wii. For 2011, Majesco is looking to launch a number of titles for the 3DS and for social-media outlets like Facebook.
Zynga has done well with its own lineup of games there, and that could be one of the outlets that bolsters developers' bottom lines. Mad Catz (AMEX: MCZ ) and Glu Mobile (Nasdaq: GLUU ) have found the very small screen venue to be a profitable option, and CAPS member rdelp1 sees Facebook helping Majesco make a comeback.
Majesco's had an uneven history, which might account for why just 73% of the 30 CAPS members rating the game maker mark it to outperform the market, but social-networking platforms could be the game changer. Let us know on the Majesco Entertainment CAPS page whether this is a stock you could play.
Secure in the knowledge
For a company that's moved almost 70% higher over the past month and quadrupled in value over the past year, there's hardly any news supporting VirnetX's rise. It owns patents to secure real-time communications over the Internet, like text messaging and file sharing, and last year's big news was getting Microsoft to pay it $200 million for a license.
It did recently open its technology for licensing to meet 4G LTE specifications, and AT&T's purchase of T-Mobile might have caused investors to think this is going to be a big forum for it in the future. Yet it may have another revenue stream in its patent infringement lawsuits against Apple (Nasdaq: AAPL ) and other tech giants who may have to pony up lots of cash, like Microsoft did, for licenses and royalties.
Last November, CAPS member dustinmoh6 foresaw the value of the foundation VirnetX was laying:
VirnetX has declared that their patents are ESSENTIAL for 4G/LTE security. Furthermore, they now have had their patents' validated by a jury, and confirmed by the US Patent and Trade Office, and also have a license from Microsoft. This may be one of the most overlook technology stocks in the mobile space. A potential royalty cash machine here.
Add VirnetX to the Fool's free portfolio tracker to keep an eye on whether it can continue to secure its patents.
Should I stay or go?
Earlier this year, Adeona Pharmaceuticals shook things up after it acquired access to clinical data supporting a zinc-based therapy for the prevention of infections in the elderly. The data suggest two-thirds of patients treated with an oral zinc therapy reported a reduction in the incidence of infection.
Adeona will be reporting clinical trial results this month on its lead drug candidate Zinthionein -- which it has renamed reaZin -- a compound made of zinc and cysteine, an amino acid with antioxidant properties. Assuming the results are positive, Adeona may soon find willing marketing partners. A multiple sclerosis therapy it's developing received a $409,000 grant, so the future's looking pretty good here.
CAPS All-Star zzlangerhans thinks Adeona's move higher this month is a result of an unwarranted halo effect from news from Down Under. Australia-based Prana Biotechnology reported some positive data with compounds similar to Adeona's, so the latter's stock moved higher in sympathy:
Late in the day someone apparently decided that since Adeona and Prana have a similar approach to treating Alzheimer's via increasing bioavailability of zinc, Prana's ridiculous rise had positive implications for Adeona. The word was spread and hence a late 20% bump in Adeona's share price.
You can have a big impact by sharing your thoughts about its prospects on the Adeona Therapeutics CAPS page, and then add it to the Fool's free portfolio tracker to see whether its results are as good as investors apparently anticipate.
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.