Even on the market's worst days, buyout news and other short-term forces can send individual stocks up by 10%, 25%, even 50%.        

For example, shares in XL Capital (NYSE:XL) joined the list of big movers last week and rose 61% when the company reported far better than expected fourth-quarter results.

But beyond less predictable events like that one are stocks with fundamentally compelling reasons for recent momentum. The trick is to find those stocks. That's where Motley Fool CAPS comes in.

The story behind the story
CAPS is no crowd of lemmings. Its best-performing members' opinions do more to shape each company's rating than the picks of their poorer-performing peers. Let's use the collective wisdom of more than 125,000 CAPS members to filter out the noise and find companies offering strong momentum.

We'll use CAPS' handy stock screening tool to quickly zero in on companies with a stock price increase of at least 25% in the past four weeks, a market cap of greater than $100 million, and a beta of less than 3.

Below is a sample of stocks that our screen returned. If you'd like, run this screen yourself -- just keep in mind that results may change as the market does.

Company

CAPS Rating
(Out of 5)

4-Week
Price Change

Mechel (NYSE:MTL)

****

35.8%

Sigma Designs (NASDAQ:SIGM)

*****

27.7%

Freeport-McMoRan (NYSE:FCX)

*****

25%

Source: Motley Fool CAPS. Price return from Jan. 16 through Feb. 13.

Taking up the slack
Russian miner Mechel has been struggling with slacking demand, and the drop in commodities and fall-off in demand sent shares plummeting late last year. Steel production fell short in 2008 as demand from industrial producers dropped, but its total coal production rose 24% for the year, helped by acquisitions that increased coking coal output by 45%. The company also expects to curtail steel production by up to 25% in 2009 to align with weak demand.

Signs of renewed demand for steel from China are appearing, now that there are increased iron ore shipments to China from producers like Vale and BHP Billiton (NYSE:BHP). And the recent announcement of $1 billion in total credit facilities from Gazprombank further reassured investors, as the move will help Mechel pay short-term debt and navigate the near-term economic environment.

Though many investors concede that Russian companies pose risks, since Mechel is a large exporter bringing in foreign cash, many feel the Russian government will make sure the company survives. This leaves many CAPS members relishing the cheap price and bullish on the company’s potential for great returns when a turnaround arrives. Today, nearly 98% of the 1,510 members rating Mechel expect it to outperform the market.

IP, you P, we all P for TV
As Adobe Flash makes its way into more media devices, digital media chipmaker Sigma Designs recently joined Intel and Broadcom (NASDAQ:BRCM) on board the Adobe (NASDAQ:ADBE) train. The Flash platform delivers 80% of web video worldwide, which is increasingly being viewed on televisions -- with the help of Sigma’s chips in IPTV set top boxes, Blu-ray players, and HDTVs. Sigma also recently inked a licensing deal with DivX and one of its chips was selected by Spanish company Blusens to power its “blu:brain” HDTV entertainment device.

All the forward progress has been encouraging investors, and the company was even bestowed with an upgrade from Robert W. Baird analyst Tristan Gerra, who sees significant growth in IPTV set-top boxes. Many CAPS members like the company’s strong cash position and lack of debt; more than 97% of the 1,571 rating Sigma Designs expect it to outperform the market.

And you?
What's your story? Whether you buy the tale of a stock that's soaring or souring, your own research is more important than collective opinions. But these collective opinions can make your due diligence a whole lot easier.

Add your take on these or any of the nearly 5,400 stocks that our 125,000-plus members have covered in Motley Fool CAPS. It's totally free to be a part of the community, and the payback is more than worth it.

Always looking ahead, the Motley Fool Rule Breakers service has recommended Sigma Designs to subscribers. To see what other rule-breaking stocks David Gardner is picking today, take a free 30-day trial.

Fool contributor Dave Mock has his own story, but there's no "happily ever after" at the end of it. He owns no shares of companies mentioned here. Sigma Designs is a Rule Breakers selection. The Fool's disclosure policy has the momentum of a freight train, but can stop on a dime.