5-Star Stocks Poised to Pop: Otter Tail

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Based on the aggregated intelligence of 135,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, diversified holdings company Otter Tail (Nasdaq: OTTR) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Otter Tail's business and see what CAPS investors are saying about the stock right now.

Otter Tail facts

Headquarters (founded)

Fergus Falls, Minn. (1907)

Market Cap

$767.13 million

Industry

Industrial Conglomerates

Trailing-12-Month Revenue

$1.29 billion

Management

CEO John Erickson (since 2002)

CFO Kevin Moug (since 2001)

Business Segments

Electric, Plastics, Manufacturing, Health Services, Food Ingredient Processing, Other

Compound Annual Book Value Growth (over last five years)

15.4%

Dividend Yield

5.3%

Competitors

Duke Energy (NYSE: DUK)

Exelon (NYSE: EXC)

CAPS Members Bullish on OTTR Also Bullish on

General Electric (NYSE: GE)

Apple (Nasdaq: AAPL)

CAPS Members Bearish on OTTR Also Bearish on

McDonald's (NYSE: MCD)

NVIDIA (Nasdaq: NVDA)

Sources: Capital IQ (a division of Standard & Poor's), and Motley Fool CAPS.

Over on CAPS, 979 of the 1,001 members who have rated Otter Tail -- some 98% -- believe the stock will outperform the S&P 500 going forward. These bulls include robpotter and pablogrimes.

In late April, robpotter reminded our community that Otter Tail "is well positioned in terms of windy geography and wind tower construction services to benefit from the coming growth in wind energy." Our CAPS member continues: "Also, Cascade Investments (of Bill Gates money) recently revealed 9.6% ownership and announced seeking to grow stake up to 20%."

In a pitch from earlier in the month, pablogrimes expands on Otter Tail's tailwinds:

Otter Tail is a diversified investment all by itself. It's positioned to profit from wind industry, but not completely reliant. Infrastructure (stimulus) projects will benefit multiple business segments (construction, fabrication, PVC, etc.), but the utility business should stabilize income near-term. They sell and service medical equipment needed as baby-boomers age. Every item or service they provide should do well in a recovery cycle. Several of them, however, are particularly well poised at this point in time such that I believe [Otter Tail] will keep ahead of the S&P.

What do you think about Otter Tail, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 135,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Otter Tail is a Motley Fool Hidden Gems pick. Apple and NVIDIA are selections of Stock Advisor. Duke is an Income Investor choice. The Fool's disclosure policy always gets a perfect score.

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On July 06, 2009, at 10:09 AM, catoismymotor wrote:

    I believe LUK is a better choice when compared to OTTR.

  • Report this Comment On October 18, 2009, at 4:33 PM, blesto wrote:

    OTTR better dividend than LUK

    but LUK seems to outperform OTTR vs s&p

    but geez, I really do love dividends.

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