With all the volatility in the markets today, there's no shortage of market seers attempting to call a bottom. Man of the Year Ben Bernanke called a bottom not once, but twice. Heck, even Keanu Reeves laid out what a world-ending market bottom looks like.

Investors should consider buying stocks after a big decline, when pessimism has unduly beaten good companies down to great prices. That's why we here at the Fool -- and 150,000-plus investors like us -- look to the Motley Fool CAPS community to help sniff out the real opportunities from languishing companies driven by speculation.

A real bottom or another leg down?
Of course, there's no foolproof method for timing a market bottom. But CAPS has a great balance of both quantitative and qualitative resources available on 5,400 stocks, and even a nifty stock screening tool to help investors quickly zero in on potential investment opportunities. Once we've rounded up our candidates, we can use all the information in CAPS to test whether each company has already hit bottom or simply primed shareholders for further pain.

I've used the CAPS screener to filter out $100 million-plus companies that have seen their stock price appreciate by at least 15% in the past 13 weeks even while they remain at least 40% below their 52-week high.


CAPS Rating
(out of 5)

Price Change

% Below
52-Week High









Century Aluminum (NASDAQ:CENX)




Source: Motley Fool CAPS.
Results: Nov. 13 through Feb. 8.

The bottom case
While the downturn may have been brutal to many Century Aluminum investors, there are many reasons to believe the stock may be looking nowhere but up today. Shares of Century Aluminum spent much of last year on the rise, as some investors expect to see an increase in demand for aluminum with global construction regaining its strength. 

At the same time, the firm has managed to cut costs and reduce debt repayments in 2011 to help strengthen liquidity and its financial situation. Century itself has said that it sees improving global economic conditions and stronger demand for industrial metals in China. Other companies, like dry bulk shipper DryShips (NASDAQ:DRYS), second that sentiment and see improvement on the horizon.

Century and some of its major customers, like Rio Tinto (NYSE:RTP) and BHP Billiton (NYSE:BHP), are positioning themselves to benefit from a return in demand, even though the recovery could see mixed results in the short term as global stimulus programs wind down. Many CAPS members are on-board with the positive long-term outlook shared by Rio Tinto, which sees a particularly favorable outlook for metals, expecting demand to double in the next 15 years thanks to growth in China and India.                                         

Or dead cat in disguise?
But even with some encouraging macroeconomic wind filling its sails, the fate of Century Aluminum isn't completely assured. Earnings season for metals companies has gotten off to a slow start, with many firms still feeling the recession's effects. Competitor Alcoa's (NYSE:AA) report was short of expectations and steel company Steel Dynamics (NASDAQ:STLD) posted lower shipments and fourth-quarter revenue. Even Aluminum Corp. of China warned of a loss for 2009 due to excess industry capacity, and some investors have growing concerns about the tightening of government policies in China.

Although companies like Rio Tinto have a bullish long-term outlook, today shows the company still running some of its aluminum smelters below capacity. With Century Aluminum posting losses and negative free cash flow in recent years, some investors aren't so certain it's the best place to invest today and see any number of factors pressuring shares lower.  

What's your call?
About 91% of the 471 CAPS members rating Century Aluminum are bullish and see it outperforming the broader market. For my part, I like the prospects that Century Aluminum offers. But that comes with the understanding that it could take years to see it reach its full potential, given the current economic climate.

But what ultimately counts is your own opinion; CAPS is just there to help you form it. The best part is that the Motley Fool CAPS database is all free, and you can even add your own insight on any of the 5,400 stocks that our 150,000-plus members have covered.

The Motley Fool Stock Advisor service looks for companies with strong management poised to beat the market over the long haul. To see all the stocks that have helped Tom and David Gardner beat the market by 50 points on average, take a free 30-day trial.

Since getting some new sneakers, Fool contributor Dave Mock is showing a little more spring in his step too. He owns no shares of companies mentioned here. The Fool's disclosure policy sometimes gets wound too tight and needs a deep-tissue massage.