Stocks climbing to 10 times their original price are rare breeds -- but they're not impossible to find. Especially when you have Fools for friends.
The market's best stocks include companies that have risen dozens of times in value by taking advantage of the market's weaknesses. These aren't penny stocks; they're viable companies with sound business prospects that are achieving phenomenal returns. Finding just one or two of these monstrously successful firms can help you establish a winning portfolio.
Stalking the monster
To find tomorrow's winners, we've enlisted the help of more than 170,000 monster trackers at Motley Fool CAPS. We've compiled a list of the most successful CAPS members, dubbed All-Stars, whose picks have doubled, tripled, or even quadrupled in price. Then we've plucked out some of their recent picks for stocks they find equally promising.
Score is how many percentage points that pick is beating the S&P 500.
Of course, this is not a list of stocks to buy -- or, for those monster stocks that our CAPS All-Stars have already found, sell. Just consider them starting points for your own further research of extreme buying opportunities.
In search of Bigfoot
With oil drilling rights off the west coast of Africa, CAMAC Energy might seem to be in a situation similar to Hyperdynamics'. I'm cautiously optimistic about that company, but have enough reservations that its one-star CAPS rating still gives me the heebie-jeebies about investing in it at the moment.
While Hyperdynamics holds significant drilling rights in West Guinea and CAMAC's rights are in Nigeria, I'd say CAMAC is closer to VAALCO Energy (NYSE: EGY ) with its interests in Gabon, because it has moved on to become a production company now that its Oyo field has begun pumping oil. Hyperdynamics is still a development-stage company, though proponents suggest it will soon turn the corner, too.
CAPS members have reservations about CAMAC, though, as 40% of those rating its stock believe it won't beat the market anytime soon. Yet it's still flying under the radar of most investors (less than a hundred have weighed in), so why not head over to the CAMAC Energy CAPS page and tell us why we should drill down further on this oil driller.
A good reception
Iconic film and camera maker Eastman Kodak is another company that has sent chills down my spine. Having missed the big picture as consumers converted to digital cameras, Kodak is increasingly becoming a company reliant upon licensing its intellectual property.
Indeed, it just reported last week that losses narrowed from the year-ago period as a result of inking a huge licensing deal for its digital camera technology (it accounted for 12% of net revenues in the quarter). As the deal wasn't reached in a courtroom, analysts are hopeful this could be a new start for the company. (Kodak is, for example, suing Apple (Nasdaq: AAPL ) and Research In Motion (Nasdaq: RIMM ) , accusing them of patent infringement over previewing pictures taken on their respective phones.)
Yet that was my problem with Kodak the last time it put up some big numbers. These are one-time, non-recurring infusions of cash. It's going to have to slog through a heckuva lot of companies to hammer out a sustainable business model, or spend an awful lot of time in court suing companies into submission.
CAPS member xjp83x begs to disagree, saying Kodak's competitive moat is wide and the "worst" that could happen is someone buys it out:
There's no way Kodak will go down. They actually have decent products out there and have a great name that customers recognize. All that took accounting courses should know the term "goodwill". All that read about Warren Buffett should have heard about "wide moat". Kodak has both. The worst thing that can happen to Kodak is being bought by a big corporation like HP. Or is that good...?
Only you can sound out whether Kodak is right for your portfolio. Add it your My Watchlist page and have all the Foolish news and analysis about the stock aggregated in one place.
Inflating values
Office Depot also surprised analysts by reporting a $0.04-per-share profit when the consensus was for a penny-per-share loss. But with revenues and comps down year over year, the office supplies retailer had to initiate big cuts in overhead to get profitable. Revenues were down 4%, but warehouse operations were cut 7% and SG&A expenses were slashed almost 13%. That's a good temporary salve, but is not sustainable.
The company has felt the impact of promotional pressures from both Staples (Nasdaq: SPLS ) and OfficeMax, and its CEO just resigned in connection with violations of Regulation Fair Disclosure, aka Reg FD. The company is in a state of flux and there doesn't appear to be any tailwinds moving it forward. Yet 86% of CAPS members rating Office Depot think it can go on to outperform the broad market averages.
Join with them on the Office Depot CAPS page and let us know whether it will be able to make enough profit on paper clips and push pins.
A chance for scary growth
It takes more than a few All-Star picks and a quick pitch to make buy or sell decisions, so start your own research on these stocks on Motley Fool CAPS and find other opportunities with monster potential.
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