5 All-Star Stocks

Win or lose, we've all got an opinion about which stocks are rockets and which are dogs. If we could invest like Peter Lynch or Mohnish Pabrai, we'd probably have a lot more companies in our win column than on the loss side of the ledger. Warren Buffett began buying railroads last year, and just about any company that ran on tracks came into play.

So when top-notch investors back a stock, you might want to give it more consideration. Over on the investor-collaboration site Motley Fool CAPS, we can do just that. On CAPS, players who've earned a rating of 80 or better by consistently outperforming their peers are dubbed All-Stars. Sometimes, these ace investors will back a stock that others think is a dog. Considering the All-Stars' track records, we might want to look a little more closely at their selections.

Here are five companies that have been marked down by some investors, but enjoy unanimous All-Star backing:

Of course, this isn't a list of stocks to buy and sell; instead, it should serve as a starting point for your own research and analysis.

Building communities
Pharmacies that cater to patients with chronic illnesses have been an alternative model that BioScrip has found to be successful. For example, HIV/AIDS patients require a level of resources, advice, and personal attention that mail-order prescriptions can't meet. BioScrip, which also operates mail-order specialty pharmacies, has located its retail establishments in neighborhoods that exhibit large numbers of such patients. Through an agreement with UnitedHealth (NYSE:UNH) in 2007, Bioscrip became a specialty provider of drugs and services to HIV/AIDS patients insured by UnitedHealth.

Yet there are challenges ahead for all types of pharmacies. CVS Caremark (NYSE:CVS) also operates retail specialty pharmacies through its CarePlus division, which has the resources of a large chain behind it. Further, mail-order specialty pharmacies like ExpressScripts (NASDAQ:ESRX) give patients a level of convenience in obtaining their medications that small retail stores can't meet: Not everyone lives near a BioScrip store. Of course, with a dual structure, it could be that BioScrip has the best of both worlds, though certainly the mail-order business would have lower costs.

Investors like CAPS player davilin07 are beginning to find the prospects of future appreciation in the share price irresistible, since the shares sold off leading up to the company’s earnings announcement:

Am I missing something? After reading the Earnings Release for the quarter ended March, 31 2008 the only thing that has somehow suffered is the gross profit, that is about half point below same period the year before. Don't find any other reason that justifies a decline of almost 33% in just three days. Since the stock had a performance of almost 300% during the last year, maybe there was too good expectation for this stock and this is just a correction to more "normal" levels. Anyway, I think this 3 days sharp decline is too much punishment for this company, so I consider this level below $4.50 a good bargain to get in.

The contract with UnitedHealth only runs through December, though BioScrip says it sees no reason why it should not be extended beyond that. Investors would be wise to recognize the potential for loss if the contract is not renewed.

An All-Star act
Although a few CAPS investors have bet against the house here, we haven't yet heard from you. Why not head over to Motley Fool CAPS now and let us know what you think about these and your other favorite investments? It's completely free, and -- along with the other 105,000 investors there -- you may help uncover the next All-Star stock.