4-Star Stocks on the Upswing

Sadly, there's no such thing as an ultimate buy signal when it comes to investing in stocks. Identifying companies with the wind at their backs takes time, patience, and a good dose of due diligence.

There is, however, an easy way to increase your odds of finding the stocks that will beat the market. At Motley Fool CAPS, the Fool's investing community of more than 130,000 members, we've found that four- and five-star stocks, as a group, have outperformed the broader market -- to the tune of seven and 12 percentage points, respectively -- on an annualized basis from November 2006 to July 2008.

To fully capture the upside potential of those highly rated stocks, it makes sense to identify them just as soon as they are upgraded to four- and five-star status. Fortunately, our CAPS screener now makes it possible to do this. Below, for example, is a list of companies that have been upgraded to four-star status from three stars just yesterday. These stock ideas are only a starting point, of course. Be sure to join us on CAPS to dig in even further.

Company

All-Stars Saying Outperform

Rackspace Hosting (NYSE: RAX  )

117 of 126

iPath S&P GSCI Crude Oil Total Return Index ETN (NYSE: OIL  )

517 of 574

Double Hull Tankers, Inc. (NYSE: DHT  )

193 of 208

Acuity Brands, Inc. (NYSE: AYI  )

204 of 218

DreamWorks Animation SKG, Inc. (Nasdaq: DWA  )

457 of 502

Pfizer, Inc. (NYSE: PFE  )

4829 of 5405

Data from Motley Fool CAPS, April 20, 2009.

Come join us on CAPS, absolutely free, to learn more about these and countless other interesting stock ideas.

Disclosure is important to us here at The Motley Fool. No individual person selected the stocks in this article, so there is no author to disclose an interest in them. Since this article was automatically generated, it is possible that Motley Fool personnel (and even The Motley Fool itself, through our Motley Fool Pro, Million Dollar Portfolio, and Ready Made Millionaire services), have positions in these stocks. We thought you'd like to know that. You can learn more about The Motley Fool’s disclosure policy here.


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