For every stock out there screaming "buy me," others simply give us a nudge and a nod. While all the attention might be focused on their five-star peers, we can sift through Motley Fool CAPS to find four-star stocks giving us the "high sign" they're approaching greatness.
These opportunities -- including familiar names and beaten-down companies -- rank higher than most of the other 5,400 starred companies, and it pays to investigate their potential. For consideration today I've got this handful of stocks on their way to fame.
- BP (NYSE: BP )
- Coach (NYSE: COH )
- Silver Wheaton (NYSE: SLW )
As the 170,000-plus CAPS members have chosen these companies as less obvious sources for tomorrow's great buys, let's see why they might merit your attention.
In the sight of greatness?
Yes, I know BP's Gulf of Mexico oil spill incident still sticks in everyone's craw. The Obama administration's glacial pace on issuing new permits for drilling hasn't helped. More than a year after the oil spill, the U.S. is only at about one-third the level of activity it had been beforehand, and drillers like Ensco (NYSE: ESV ) have sued the government to speed up the process.
Some, like Royal Dutch Shell (NYSE: RDS-A ) , are considering joining in on the lawsuits that target BP for lost business as a result of the drilling moratorium. It says it lost between 25,000 and 30,000 barrels a day of production in the first quarter because of permit delays and around $260 million because of idled rigs last year.
BP rejects such claims, and while it looks messy PR-wise, the oil company isn't a piggybank for companies to dip their hands into. It is responsible for the direct harm its actions caused, and it has been paying out on claims from the fund it established and has secured an additional $1.1 billion to continue paying. Yet it hardly seems reasonable to hold it responsible for the actions of the president.
The ban itself will only serve to weaken America's position in the Gulf. Brazil, Venezuela, and Cuba are all still actively pursuing assets there, so we're only placing our industry at a disadvantage.
Highly rated CAPS All-Star TMFDeej admits BP is a difficult company to like at this point, but said last month that its stock certainly represents a good value.
Even with the potential damages from the mess that it helped create in the Gulf, there's no reason that it should trade at a 70% discount to Exxon.
Drill down further on the BP CAPS page and let us know if the oil company is still a slick opportunity.
I'll buy that
"Affordable luxury" might be a cliche, but handbag maker Coach has proven itself adept at navigating the recessionary climate and its aftermath. But then so have other providers of higher-end goods and services like Tiffany, Nordstrom (NYSE: JWN ) , and True Religion Apparel. Consumers at all levels have been willing to bid up shares of those which bring us the goods on quality goods.
The risk for all of them is rising commodities costs. Apparel makers are feeling the impact of soaring cotton costs and all face rising transportation and labor expenses. Coach has gone so far as to start scouting out areas in Thailand to offset the cost of labor going up in China. What may pinch margins a bit more is higher leather costs. Luxury goods maker Hermes has reported a 10% spike in leather costs over last year.
With an eye on its international ambitions, CAPS member MYPIX thinks the affordable luxury Coach presents will never go out of fashion.
There will always be a market for high quality designer accessories. This company has plenty of room to grow in plenty of emerging markets. We have only begun to see the start of where Coach is headed.
You can follow along by adding Coach to the Fool's free portfolio tracker and see if it's a luxury affordable enough for your own portfolio.
A solid opportunity
Although rising commodities prices hurt many, there are some companies that benefit. Silver Wheaton's stock has followed along with the rise of the precious metal. Though both have pulled back from their recent highs, Silver Wheaton's recent quarterly results showed the relationship. First-quarter net profits surged 142% as silver jumped 85% coupled with a 10% increase in production volume.
Hecla Mining (NYSE: HL ) also still represents an excellent value, but there are good reasons to believe Silver Wheaton is still going higher, too.
CAPS member brycetill says you can't beat Silver Wheaton's cost structure.
With SLW's outlook for silver production for the next 5 ears and an average silver price of 40 it represents a 25% CAGR for the next 5 years. Imagine if silver goes to $100!
You can see if it can offer further returns on investment by adding it to your watchlist.
A great opportunity for you
Investor sentiment suggests these four-star investments still seem to be on their way to five-star greatness, but it pays to start your own research on these stocks on Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made all from a stock's CAPS page.
Sign up today for the completely free service and let us hear what you have to say about the great and almost great companies that interest you.
RSS Headlines
Fool UK