10 Stocks Shaking the Market

Some stocks are one-hit wonders that make a big splash when they first appear and then quickly fizzle. But for other stocks, that initial big move is only a preview for even bigger and better gains to come.

Today, we've compiled 10 stocks that made some of the biggest upward moves over the past month. We'll then pair that list with the ratings issued by our Motley Fool CAPS community. The higher each stock's rating, the greater our CAPS members' faith in that company's ability to continue beating the market.

Return from June 17 to July 16.

The markets have recently rebounded after several consecutive losing weeks, but the gains have been less than those experienced by these movers and shakers. Almost all of these stocks carry low one- and two-star ratings, so let's see why the CAPS community thinks some of these companies might end up outperforming the market.

A mighty temblor
Solid-state-drive producer STEC is spinning faster, as its ZeusIOPS line continues to rack up impressive sales gains. Shipments for flash memory devices into the enterprise-storage market more than tripled last quarter, and STEC recently signed an agreement with one of its largest enterprise-storage customers for sales of $120 million of ZeusIOPS in the second half of 2009. Just before that, STEC had announced a $28 million deal with a military contractor for another of its solid-state-drive (SSD) products. Even before these deals were inked, the company had boosted guidance for the second quarter, based on stronger sales.

With no debt and more than $57 million in cash, STEC's clean balance sheet puts it in position to take advantage of potential growth opportunities. Its drives offer a compelling alternative for enterprises by being able to replace anywhere from 30 to 150 hard drives while achieving the same performance.

The growth potential of the SSD market is a main attraction for investors such as CAPS member msrs2k, who sees the desirability of these high-performance drives trickling down from the enterprise-class business.

STEC SSDs are now used by all 5 of the major enterprise storage vendors. [NetApp] is likely to become a customer soon as well. As SSDs have not yet reached market saturation, and STEC is growing margins, it's hard to see earnings not matching or beating estimates.

Currently STEC SSDs are mostly limited to the enterprise class storage arrays. I expect the market for SSDs to expand down into midsize business arrays (as all high-end array features do) greatly enlarging STEC's market opportunity.

Weight-loss-drink maker Medifast saw its shares jump not only over the past month, but also since February, when the Fraud Discovery Institute leveled charges that the company was a Madoff-like pyramid scheme. Such charges are always likely to irritate shareholders and disturb the market, and shares tumbled on the allegations.

Since then, however, Medifast shares have soared two and a half times higher than where they were when the criticism was leveled. Although the company plans to open more bricks-and-mortar weight-loss centers, the real growth story here is the "Take Shape for Life" sales channel, in which revenue climbed by 92%. Such sales are made by Medifast's "active health coaches," which grew 82% in number over the past year. It's these coaches who are causing the Fraud Discovery Institute consternation, since the institute says that Medifast's SEC filing says little about the coaches' remuneration.

Even so, more than 83% of CAPS members rating Medifast say they believe it will outperform the market, although its two-star rating suggests that it doesn't rank particularly high on their charts. Why not head over to CAPS and weigh in with your own view of Medifast's prospects?

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.