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, shares of Somaxon Pharmaceuticals (Nasdaq: SOMX) more than doubled in value in a single day recently after it finally received FDA approval for its insomnia drug Silenor.

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 160,000 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 25% 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.


CAPS Rating
(out of 5)

Price Change




Sonus Networks (Nasdaq: SONS)






Citigroup (NYSE: C)



Boyd Gaming



Source: Motley Fool CAPS. Price return from Feb. 26 through March 26.

After ending 2009 on a low note, USEC's shares have produced some solid gains so far this year, and recent events working in USEC's favor have some CAPS members feeling more confident in the long-term viability of the company. The uranium enrichment company reported fourth-quarter financials that included an increase in revenue and a near doubling of profits thanks to a $70 million settlement over protective trade tariffs.

On top of the upbeat operating results, investors are also bullish on the recent cost share agreement that the company reached with the U.S. Department of Energy that will provide funding for USEC's American Centrifuge Plant. After the government denied its loan guarantee request last year, investors think that the DOE's recent vote of confidence is a step in the right direction to eventually receiving a loan guarantee.

With support from customers like Exelon (NYSE: EXC) and a more supportive political environment, CAPS members like the brighter outlook for USEC as 96% of the 1,399 members rating USEC expect it to outperform the broader market.               

After a very bad couple of years, increasing investor sentiment and some bullish words from Citigroup's management has some investors believing that things are looking up for the beaten-down megabank. The company's CEO Vikram Pandit recently said that the bank continues to make progress in shedding assets and is on the road back to eventual profit as the company focuses on growing emerging markets while slimming its domestic operations.

Some CAPS members are also upbeat about the news that the U.S. government may begin winding down its position in the company that it ended up with after funneling bailout money into financial institutions like Citigroup, Bank of America (NYSE: BAC), and AIG (NYSE: AIG) to save them from collapse. Some investors believe a government exit will help relieve pressure on shares, but others remain concerned about potential underlying risk. At this point, a lukewarm 82% of the 9,703 CAPS members rating Citigroup see the bank beating the broader 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 5,400 stocks that our 160,000-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.

The Motley Fool Inside Value team looks for stocks that are selling at bargain prices well below their intrinsic value. To see the full list of cheap companies the service is recommending 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. Exelon is an Inside Value recommendation. Motley Fool Options has recommended a write covered calls position on GameStop. The Fool's disclosure policy has the momentum of a freight train, but can stop on a dime.