Stocks Everyone Says to Buy Now

5 Recommendations

Some stocks simply have such great potential that "everyone" knows they're a good buy today. Yeah, we wish.

If we'd known beforehand that Electronic Arts (Nasdaq: ERTS) was going to return more than 580% over the past 10 years, we'd have mortgaged the house to the hilt. If we'd had the inside scoop that Hansen Natural was a 19,000% winner over the past decade, we'd have mortgaged your house, too!

In fact, if investing were so easy, we'd all be millionaires. It's easy to see after the fact which companies have been the winning investments. What we need is a way to know beforehand which companies will become the next Microsoft or Wal-Mart and grow thousands of percent in value over the years. But there hasn't been a way.

Until now, that is.

More than 73,000 professional and novice investors have rated stocks on Motley Fool CAPS, and we can check in on their opinions about which stocks will beat the market and which will lose to it. While it's often a tug-of-war between the bulls and the bears, we've identified dozens of stocks that members of CAPS have unanimously said will outperform the market.

That's no small feat. Thousands upon thousands of companies have been rated in CAPS, and convincing arguments can be, and are, made on both sides. For example, Motley Fool Stock Advisor recommendation Nvidia (Nasdaq: NVDA) is a top-rated stock with ratings from more than 1,700 CAPS investors. Yet while some 1,634 of them think the stock will beat the market, that still means there are almost 100 CAPS investors who don't.

So when you come across a stock that everyone thinks is going to outperform, you've got something special, and we as investors ought to take notice.

Here, then, are a handful of those "obvious" investments.

Company

Bulls

All-Star Bulls

Price

Return on Capital, Trailing 12 Months

Key Technology (Nasdaq: KTEC)

90

40

$27.44

10.8%

GlobalScape (AMEX: GSB)

96

19

$6.60

43.4%

Utah Medical (Nasdaq: UTMD)

93

38

$29.89

16.9%

Exponent (Nasdaq: EXPO)

95

44

$29.00

12.6%

Sources: Motley Fool CAPS, Yahoo!, and Capital IQ, a division of Standard & Poor's. Price reflects yesterday's close.

As always, none of the companies on this list should be considered formal recommendations, but rather starting points for further research. What we've done is narrowed your workload by focusing on the companies that CAPS investors are universally expecting to beat the market.

Expecting Exponent-ial growth?
It's understandable why engineering consulting firm Exponent changed its name from The Failure Group. It doesn't exactly convey a positive image, particularly if you're in the game of winning contracts to build government robots. Regardless, CAPS investors don't seem to think Exponent can fail anytime soon. In fact, almost half of those rating the company are considered All-Stars -- investors who consistently outperform their peers over time.

For example, there's All-Star dustbusterz, with a player rating of 87.14, who thinks the company's management is worthy of backing -- although there are areas of concern he'll keep an eye on:

I'm Bullish on this one. They have great management (a little [nervous] about rising receivables, but all other [components] look great). [I] think this company has what it takes to get noticed (by wall street) and increase shareholder value.

Another All-Star, PearlandTX, who is outperforming 96% of all other CAPS investors, believes the company has consistently been able to put up good numbers:

Consistent financial performance, net margins [above] 9%, P/E reasonable at [25], using cash to buy back stock, interesting market space. Could become a takeover target.

Let's hear from you
How about your take on these or other "obvious" winning investments? Is this the chance to exponentially profit from the next "buy now" stock? If you want to add your two cents, sign up to join the Motley Fool CAPS community, which is 100% free.

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Exponent, Inc.

EXPO Up! $26.40 +1.42 (+5.68%) 4:00 PM
CAPS Rating:
219 Outperforms
4 Underperforms
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