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Tomorrow's Monster Stock

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 180,000 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.


CAPS Member Rating

Monster Stock

CAPS Score

Recent Stock Pick

CAPS Rating (out of 5)

chk999 100.00 Chinalco 105.66 Dolby Labs (NYSE: DLB) *****
BravoBevo 99.99 General Growth Properties 1026.89 Lihua International (Nasdaq: LIWA) **
vanamonde 99.99 Macerich 766.27 (Nasdaq: LOCM) ***

Score is by 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.

Scanning the market
Boy, this whole tablet computer thing is proving a real headache, ain't it? Well, if you're a netbook or PC maker, or you make the sound technologies that feed off the hardware, it's not going all that well. Sound king Dolby Labs is getting dragged down because PC shipments continue to tumble.

According to the industry researchers at Gartner, shipments fell 5.6% in the second quarter, with worldwide growth at just 2.3%. PC maker Dell (Nasdaq: DELL) saw shipments drop 10%, while Hewlett-Packard (NYSE: HPQ) was down just over 1%.

Dolby has always relied in large part on the PC industry to foster its own growth, and with the iPad dominating the niche -- but not carrying Dolby codecs -- it's feeling the pinch. If that was all Dolby had going for it, the trend might be worrisome, but Dolby is also a leading player in digital cinema technologies (and not just the surround sound you hear at the movies), 3D cinema, gaming, and, increasingly, mobile handsets.

But CAPS member BeSmarter isn't worried about Dolby's future:

Their technology will become far more pervasive, and be licensed to providers of MP3 players, tablet computers or the content providers who provide streaming or [downloadable] content. Near its 52-week low. 16 PE.

Sound off in the comments section below or on the Dolby Labs CAPS page and let us know whether you think we'll still be hearing from the sound specialist in the future.

In search of Bigfoot
Chinese copper-wire products maker Lihua International is yet another reverse-merger small cap coming under scrutiny, but because it hasn't been accused of outright fraud as so many others have, investors remain hopeful. If Lihua remains on the up-and-up, it has the potential to realize substantial gains.

In June, China gave Lihua the right to import scrap copper, a move that it thinks will offer substantial savings over buying from domestic producers. Considering the faltering state of the U.S. economy, copper prices are falling because of the weakened manufacturing base. The ISM manufacturing index is barely treading water in expansion territory, a situation that's likely to fall hard on miners such as Freeport-McMoRan (NYSE: FCX).

CAPS All-Star CryingofLot49 is worried that Lihua is a fraud, just as so many Chinese RTO stocks have been revealed to be, but 91% of the CAPS members rating the copper scrapper believe that it will go on to beat the Street. Still, the low two-star CAPS rating they've assigned it suggests that they think there are better places for your money.

You can follow along by adding the adding Lihua International to your watchlist and see whether it can dig up new growth.

Delivering solid growth
Everyone wants to be Groupon these days and offer local discounts to consumers. Even local-advertising site is glomming on to the "Groupon effect" by buying Screamin' Media Group, a local daily-deals site, for $12.5 million. It does separate itself from all the me-too pretenders by offering local businesses a platform to advertise the services, much like ReachLocal (Nasdaq: RLOC), but spending money to get into a space that's already burgeoning with competitors hardly seems like a wise use of cash.

The stock trades at more than half off its 52-week highs, but analysts forecast that it will grow earnings more than 150% this year. ReachLocal has similar profit-growth potential, but comparing its price to its sales, it carries a massive premium to

Because the niche is hot, it's not surprising that investors think can succeed here, too. More than 90% of the CAPS members rating the advertiser think it will outperform the broad market averages, but you can tell us on the CAPS page whether you think its stock is still a good deal.

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 marvel at the range of opinions there.

Motley Fool newsletter services have recommended buying shares of ReachLocal and Dolby Laboratories. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Rich Duprey owns shares of Dolby Labs but has no financial position in any of the other stocks mentioned in this article. You can see his portfolio. The Motley Fool has a disclosure policy.

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