Individual stocks can surge 10%, 25%, or even higher in a short period of time. And they can fall just as far, just as quickly. For example, shares of Jackson Hewitt plunged 23% last Thursday, after the company announced that a bank that was supposed to supply its tax-refund loans to customers in 2010 is backing out.  

Big drops in share price can sometimes signal material defects or new risks. But at other times, they're simply pullbacks along with the larger pessimism facing the market today. Fortunately, we have Motley Fool CAPS, a great resource to help us understand the larger picture behind big price drops.

Is the sky falling?
CAPS contains more than just the crowd's opinions. Its best-performing members' votes count more in shaping each company's rating than do the picks of their poorer-performing peers. That way, investors can intelligently use the collective wisdom of more than 145,000 CAPS members to make better decisions.

We'll use CAPS' handy stock screening tool to quickly zero in on companies that sport three factors: Their prices have fallen at least 15% in the last four weeks, and they have a market cap greater than $100 million and a beta of less than 3.

Company

CAPS Rating
(out of 5)

4-Week
Price Change

SIGA Technologies (NASDAQ:SIGA)

**

(36.5%)

Citigroup (NYSE:C)

**

(16.5%)

KongZhong (NASDAQ:KONG)

***

(15%)

Source: Motley Fool CAPS. Price return Dec. 4 through Dec. 28.

SIGA Technologies
Talk about timing -- only a day after deathbed stock SIGA announced it had reached agreements to sell $20 million in stock to help further develop its drug candidates, investors received another dose of unwelcome news, causing shares to drop even further. The U.S. government announced that it was modifying its request for proposal for a smallpox-fighting antiviral drug. That spooked investors, prompting them to wonder whether more competition will be added to the deal, now that the government plans to award more than one contract for the project. SIGA's candidate, ST-246, may well have a shot at winning at least one of the contracts, but some CAPS members are shying away from the uncertainty of a company that's not currently generating any earnings. At this point, a lukewarm 76% of the 159 CAPS members rating SIGA Technologies expect it to outperform the market.

Citigroup
After two months in which credit card companies reported declining credit card charge-offs, Citigroup's expectation of growing losses resumed in November. The megabank reported charge-offs of more than 10%, while rivals such as JPMorgan Chase (NYSE:JPM) and Capital One Financial (NYSE:COF) also reported worsening numbers.

Shareholders also suffered some additional dilution, after Citigroup issued more shares in a rush to pay off the U.S. government and exit TARP. Although the move will free Citi from much of the government's scrutiny, it also means that the company's losing its guarantee against excessive losses, and piles on roughly $10 billion in pre-tax losses related to the repayment. Some CAPS members remain wary of the bank's vulnerability to further possible economic swings. Today, about 81% of the 9,081 CAPS members rating Citigroup are bullish.

KongZhong
China's recently stepped-up anti-porn campaign is expected to take a toll on the revenue of wireless interactive entertainment provider KongZhong. Its partner China Mobile (NYSE:CHL) will suspend billing customers for some of its services, even those that don't contain offensive content. The country's regulators accused Google's (NASDAQ:GOOG) Chinese site of spreading vulgar content over the Internet several months back, and it's already shut down thousands of Web sites. KongZhong notched down its fourth-quarter revenue guidance because of the resulting impact on its mobile games and wireless Internet services. In CAPS, 95% of the 1,047 members rating KongZhong still see it beating the broader market.

Ultimately, whether or not you believe a fall in any stock is warranted, your own research is more important than collective opinions. CAPS can help you quickly focus your due diligence, and even point out potential pitfalls you may not have seen.

Add your take on these or any of the 5,300 stocks that 145,000-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.

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Fool contributor Dave Mock habitually looks for silver linings in even the darkest of clouds. He owns no shares of companies mentioned here. The Fool has a financial position in China Mobile. The Fool's disclosure policy is made of sugar and spice and everything nice.