Even on the market's worst days, headlines and ticker feeds tout soaring stocks. Some juicy rumor or biotech wonder drug seems to be reason enough for a stock to climb 10%, 25%, even 50% -- sometimes in a single day. Sometimes, the companies are familiar, but many are names and stories largely unknown among investors.
Often, news of a buyout offer sends a stock rocketing. That's what happened when VeraSun Energy
Luckily, there's help right at your fingertips. Motley Fool CAPS is a great tool for not only finding and screening stocks, but also for getting their background information.
The story behind the story
Let's dig right in, using the collective wisdom of more than 77,000 CAPS investors to look past the splashy news and find companies showing strong recent momentum.
We'll screen for stocks showing at least 30% price appreciation in the past month. Then we'll weed out stocks with less than a $100 million market capitalization, and those with a beta of greater than 3. Setting these limits will help us steer clear of the wild, pump-and-dump land of penny stocks.
Here's a broad sampling of stocks our screen returned today.
|
Company |
CAPS Rating (Out of 5) |
1-Month Price Change |
|---|---|---|
|
IMAX |
*** |
54.4% |
|
Nektar Therapeutics |
* |
32% |
|
Hoku Scientific |
* |
45.1% |
|
Thornburg Mortgage |
* |
31% |
Let's sift further through this list of stocks that have thumped the market over the past month, and find out why they've performed so well.
The method behind the madness
CAPS contains a searchable record of its investors' opinions and comments about a company, as well as an overall ranking from its investing community. Lest you think this sounds like following a crowd of lemmings, note that the opinions of the best-performing investors are weighted more heavily than those from poorer-performing participants. Thus, a company's ranking is influenced more strongly by investors who have proved themselves better than the average dart-throwing monkey.
Life on the big screen
There's nothing like the theatrical experience of an IMAX movie. Investors in the Motley Fool Rule Breakers recommendation had a similarly moving experience last week, when the digital-entertainment company announced a deal with AMC Entertainment to roll out 100 new IMAX theaters across 33 major U.S. markets. The deal calls for IMAX to build in its latest digital cinema technology that includes a digital projection system, a harbinger of the future in which movies are no longer stored and distributed on reels.
The major deal is a huge endorsement for IMAX and its future role in theater entertainment. The company came into 2007 with lots of baggage and a tall order to grow the business, but management's development plans have finally paid off. With AMC now placing a big bet on IMAX entertainment, other theater chains will probably answer with their own plans to keep up.
Yet while comments from CAPS investors repeatedly point out that everyone loves the IMAX product, not everyone is head over heels about the stock. A total of 68 of the 655 investors rating the company are bearish, but many of their negative opinions centered on the lack of success that management was having with its revenue-sharing model and digital-cinema design. With significant new revenue coming in the next several years and digital theaters now anchoring AMC's flagship locations, many of the bearish feelings on IMAX may start to fade to black as investors find 100 new reasons to love the stock.
What's your story?
Ultimately, the only story that counts is your own. Whether you buy the story of a soaring or a souring stock, your own research is more important than collective opinions. But these collective opinions make an individual's due diligence much easier.
So step right up and chime in with your own take on these or any of the nearly 5,300 stocks that investors have covered in Motley Fool CAPS. It's totally free to be a part of the service, and the payback is more than worth it.
