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 these three stocks on their way to fame.
- Alexza Pharmaceuticals (Nasdaq: ALXA )
- Google (Nasdaq: GOOG )
- Stereotaxis (Nasdaq: STXS )
As the 170,000-member CAPS community has 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?
It's not enough to look for a good, beaten-down stock. You also need some sort of catalyst that will allow the markets to realize the company's potential. Without a catalyst, well, you just have a beaten-down stock.
On the surface, Alexza Pharmaceuticals looks more like the latter than the former. Its bipolar drug AZ-004 got a complete response letter from the Food and Drug Administration last year because the drugmaker needed to address concerns about some respiratory effects and manufacturing processes before it was ready for review. Investors have been patiently waiting for the time when it can resubmit its application.
That should be sometime this month, as Alexza says the drug it wants to market with Valeant Pharmaceuticals (NYSE: VRX ) is now ready for prime time. Acceptance of the application would provide a needed bounce to the stock, but I don't think that's the real catalyst here. Rather, it will be what happens if the FDA gives the drug the green light. Alexza already put in place the financial means necessary to carry it through its PDUFA date next year, so it's apparently already planning on acceptance.
CAPS member nizzer thinks the catalysts are in place to launch Alexza higher:
Upcoming catalysts that will provide a high run up before pdufa. Between the upcoming rally, the potential of az-004, and their drug delivery technology this can be a multi-bagger by the end of the year and in the long term
Write up your opinion on the Alexza Pharmaceuticals CAPS page, and if you're interested in learning more about this promising drug developer, add the stock to your watchlist.
Food for thought
Maybe it's just a bit of schadenfreude that I'm enjoying the many troubles Google is currently facing. A judge refused to throw out a lawsuit against it for illegally collecting WiFi data from its StreetView cameras, and the search leader is facing fines of up to $500 million for knowingly accepting ad money from companies selling addictive drugs without a prescription.
It thought it could go in with a lowball bid for bankrupt Nortel's 6,000 patents only to see a consortium of bidders blow away its $900 million offer with one valued at $4.5 billion. Considering there's also the $2.6 billion legal battle Oracle (Nasdaq: ORCL ) launched against its Android platform for allegedly misusing Java, you'd think Google would have done whatever it could to secure itself some patent protection.
And Microsoft just scored some points -- if not relevance -- by hooking up with Baidu (Nasdaq: BIDU ) to return some English search results on the Chinese search site.
Unlike CAPS member uoptrader, I've never been much of a Google fan, though I have used its search capabilities extensively. However, I agree its new Google+ service could be what it needs to change its fortunes and group all of its properties under one roof. Said uoptrader:
I have always been a fan of Google, although I have never bought the stock; never seemed to be that attractive. However, they have just started a new social network called Google . This thing is very good, and may be a rival to Facebook. I have seen a lot of chatter in the online community about this new Google and I think it is going to be a very very big hit. I am going to buy my first shares of Google today!
Follow along as things unfold by adding the stock to the Fool's free portfolio tracker.
Leaping forward
It's the technological advances offered by Stereotaxis' Niobe catheter system that attract CAPS member axemanarthur, a paramedic, to the stock:
if the Niobe system does it in half the time as a traditional cath operation (and HNSN), you can bet that hospitals and insurance companies will be pushing for this system. I am a bull for this company for these reasons.
Partnerships such as the one it recently inked with Johnson & Johnson (NYSE: JNJ ) should allow its Odyssey platform to reach a much wider clientele as well. Its specialized cardiology instruments are used in the treatment of arrhythmias and coronary artery disease, and the technological leaps forward it has been making help explain why 89% of the CAPS All-Stars rating the medical-device maker think it will outperform the broad market indexes.
Let us know your views on its potential for success on the Stereotaxis CAPS page and add it to your watchlist to keep track of all the news and analysis about this growing medical-device maker.
A great opportunity for you
Investor sentiment suggests these four-star investments seem to be on their way to five-star greatness. 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.
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