3 Stocks Breaking Out

Volatile markets seem to be the norm these days as stocks gyrate through ups and downs on a daily basis. But sometimes buyout news and other short-term forces can send individual stocks soaring by 10%, 25%, even 50% -- even on the market's worst days.        

For example, last week, shares of Jones Soda shot 62% higher after it landed a deal to sell some of its drinks in Wal-Mart Stores.     

But beyond less-predictable events like that one are stocks with fundamentally compelling reasons behind a big move. 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. Here's an example of how we can use the collective wisdom of more than 165,000 CAPS members to filter out the noise and find companies with strong potential.

We'll use CAPS' handy stock screening tool to quickly zero in on companies with a stock price increase of at least 15% in the past four weeks, a market cap of greater than $100 million, and a beta of less than 3. Then we can use the insight of the CAPS investment community to add some context to these market movers.

Source: Motley Fool CAPS. Price return from May 7 through June 4.

Universal Display
Business has been good for Universal Display, as the organic LED maker reaps the benefits of its advanced lighting technologies being used in more devices. Its recent first-quarter results, which included a big jump in revenue and smaller loss have helped push shares higher, and the company expects the positive business momentum to continue. Despite a tick down in its CAPS rating after its recent share price gains, many members still expect Universal Display to realize impressive growth as the OLED market expands. And even though DuPont (NYSE: DD) is working on affordable large-screen OLED TV screens that are still a couple years away from mass production, OLED screens are finding their way into more smartphones and devices, which should keep Universal Display's business busy. In CAPS, 96% of the 833 members rating Universal Display believe it will outperform the broader market.       

Boston Beer
Boston Beer's shares have continued to run higher this year, tacking on about another 20% gain this month following its earnings release. Many CAPS members still hold their bullish call on the domestic brewer as sales of its Samuel Adams and other brands have been flowing smoothly, even as other brewers struggle to grow sales. While Anheuser-Busch InBev (NYSE: BUD) limped across the line with lower first-quarter U.S. shipments, Boston beer generated a 19% jump in core first-quarter shipment volume with higher gross margin, and even gave an increased earnings forecast for the year. Overall, 95% of the 1,026 CAPS members rating Boston Beer are bullish on its chances to beat the S&P.

SanDisk
The success of the Apple iPad has analysts extolling the indirect benefit for flash makers like SanDisk and Micron Technology (NYSE: MU), both of which recently reported strong quarterly results. And with Google (Nasdaq: GOOG) now selling 100,000 Android-based handsets per day and numerous competing smartphones also using flash memory, SanDisk's CEO sees potential for flash demand to outpace supply. With a solid position in embedded and removable flash memory, and with mobile devices now accounting for half of its revenue compared to nearly none five years ago, a good portion of CAPS members like the position SanDisk is in, with about 92% of the 1,804 members rating SanDisk expecting it to outpace the market averages.

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 5,400 stocks that our 165,000-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.