Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

Capstone Turbine (CPST) stock may have had a volatile 2013, but it's ending the year on a great note with 43% gains.

The rally may seem unjustified for a loss-making company, but as the world's leading microturbine maker, Capstone's order book is swelling. This, coupled with management's efforts to improve margins and tap growing opportunities in the industry could propel the company, and its stock, to new heights in 2014 and beyond. Here are the key things you should note as a Capstone investor.

A fantastic year
For the financial year ended March 31, 2013, Capstone's revenue surged 17%, gross margin expanded six percentage points to 11%, and operating loss narrowed 31% year over year. The next six months through September were equally good, with gross margin hitting 14% and net losses narrowing 23% year over year. Backlog, a key indicator of future potential revenue, improved 6% to $149.8 million.

Through the year, Capstone bagged multiple orders from several pipeline and midstream, and natural gas companies in the U.S. While it didn't name the companies, Capstone's customer list includes top-class names such as Chesapeake Energy, Anadarko Petroleum, Hess, Linn Energy, Marathon Oil, and Chevron. Phew!

Capstone also received fresh orders from its new Alaskan distributor, Chenega Energy, in 2013. The President of Chenega Energy believes that it's just the "beginning of a proliferation of Capstone solutions in Alaska across multiple industries and market sectors."

In fact, Capstone's microturbines are gaining popularity outside the U.S. as well, as evidenced by the orders that the company received from several parts of the world, including China, Vietnam, Slovenia, Russia, and Germany. Furthermore, Capstone expanded its marine microturbines to the Gulf Coast, the U.S. West Coast, and Europe this year; and also installed the nation's first methane-fueled microturbine at a CONSOL Energy plant.

The massive opportunity
By now, you must have got a good idea of the massive growth potential that Capstone's business has. A new report from Transparency Market Research projects the global microturbine systems market to grow at a compounded average rate of 16.7% through 2019. What's more, the report further projects low-power-rating turbines (30 KW to 200 KW) to drive the market, which also happens to be Capstone's area of specialization.

Capstone is laying the foundation for a solid future by increasing presence in every key end market segment. In the last financial year, 55% of its shipments went to the oil, gas, and natural resources sector, 25% reached residential and commercial establishments, 14% made it to the power supply industry, and renewable energy accounted for 6% of the shipments. That certainly looks like a good mix to me.

Foolish takeaway
With nations across the world feeling the heat to reduce emissions and improve the environment, demand for Capstone's multi-fuel microturbines (can run on kerosene, diesel, biogas, or natural gas) should grow significantly in the years to come. With backlog and revenue growing at an accelerating pace, and costs well under control, the company may turn around sooner than expected.

And since the current and next quarter are typically strong ones for the company, investors can continue to expect a good set of numbers from Capstone going into 2014. This little stock certainly looks poised to climb higher next year.