Friday's Big Stocks for Big Profits

When large caps make a run for it, Fools pay attention.

Think of Microsoft. After years of poor performance, Mr. Softy and his $300-billion-plus market cap began making a move over the summer, enriching investors who bought and stayed in.

Hence, this column. For as much money as there is to be made in fast movers like Onyx Pharmaceuticals (Nasdaq: ONXX  ) , which hit a new 52-week high last week, the turtle often beats the hare. Here's a look at Friday's finest terrapins, courtesy of The Wall Street Journal:

Company

Closing Price

CAPS Rating
(out of 5)

% Change

52-Week Range

Aflac (NYSE:AFL)

$60.66

****

6.12%

$43.34-$63.25

Tyco Electronics (NYSE:TEL)

$35.02

***

5.80%

$31.31-$41.28

Kroger (NYSE:KR)

$28.65

****

3.47%

$21.12-$31.94

Avon Products (NYSE:AVP)

$41.66

****

3.12%

$31.95-$42.51

Nucor (NYSE:NUE)

$52.46

****

2.90%

$41.62-$69.93

Sources: The Wall Street Journal, Yahoo! Finance, Motley Fool CAPS.

Shares of our top gainer, insurer Aflac, were up thanks to a major Japanese contract. No doubt, that's good news. But we Fools prefer buy-to-hold stock stories. Are any of our large-cap leaders worth owning over the next three to five years?

Most of them, yes -- if you believe the 74,000-plus professional and amateur stock pickers in our Motley Fool CAPS community. But a top star rating isn't always a bullish indicator. If it were,  Apple, which has spent much of its life in CAPS as a two-star stock, would have long ago had a five-star rating.

Will that be paper or plastic?
So let's eschew the five-star stocks here. They're too obvious. Not so with supermarket Kroger, which gets a thumbs-up from investor goalie37 for superior fiscal management. Quoting:

As a long time customer of [Kroger] subsidiary Ralphs, I have seen how well run this company is. Recently [it has] added shelf space to more high-end to compete with Whole Foods (Nasdaq: WFMI  ) , while at the same time differentiating itself from Wal-Mart. The balance sheet is fine, if a little boring. Assets have remained stable while debt has gone down.

He's right. The balance has improved a great deal and, with it, returns on capital:

Metrics

Trailing 12 Months

2006

2005

2004

Cash and investments (mil.)

$164

$189

$210

$144

Total debt (mil.)

$6,655

$7,042

$7,205

$7,901

Return on capital

13.1%

12.2%

11.3%

9.3%

Source: Capital IQ, a division of Standard & Poor's.

Impressive, but I can't say that I'm surprised. My own Colorado Kroger subsidiary, King Sooper's, has been on the march for years -- to the point that it virtually dominates the local market. Knowing that, and now knowing the numbers, gives me more than enough to add Kroger to my CAPS watch list.

What about you? What would you do? Let us know by signing up for CAPS today. It's 100% free to participate.

See you back here tomorrow for more of the best of the biggest.

Cap off your day with related CAPS Foolishness:


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