Hot Stocks You're Buying Now

Welcome back to another week of hot stocks. We're taking a look at the three best-performing industries and your favorite long and short candidates in each, according to Motley Fool CAPS.

What is CAPS? It's a unique system in which each investor rates at least seven stocks versus the S&P 500, as either an "outperform" or an "underperform." Community sentiment is then calculated to produce star ratings for each stock -- five stars being the highest, and one being the lowest. All-star stock pickers, whose choices have performed better than 80% of the community, more heavily influence the ratings.

CAPS is also organized into common "tags" for industries. The database tracks the best-performing sectors over varying periods. We're using 30-day returns since our aim here is to identify the hottest stocks right now.

Now, with that preamble behind us, CAPS says the best three industries are:

  • Tobacco products, other, which includes stocks of tobacco growers. Cigarette makers such as Altria (NYSE: MO  ) and Reynolds American (NYSE: RAI  ) are categorized differently. Stocks in this sector have advanced an average of 21.8%% over the last 30 days.
  • Satellite, which includes satellite radio. Stocks in this sector have advanced an average of 20.1% over the last 30 days.
  • Optical components, which includes firms specializing in equipment used for the high-speed delivery of data. Stocks in this sector have advanced an average of 18.1% over the last 30 days.

According to you, our Foolish readers, the best stocks in these industries to own now (i.e., those with 3 or more stars in CAPS) are:

Company

CAPS
Star Rating

No. of
CAPS Ratings

Bullish
CAPS Ratings

Bull ratio

Oplink Comm.
(Nasdaq: OPLK  )

5

10

9

90%

Finisar

4

133

128

96.2%

Alliance One
(NYSE: AOI  )

4

19

18

94.7%

Source: Motley Fool CAPS

And your favorite short candidates (i.e., those rated 1 or 2 in CAPS) are:

Company

CAPS
Star Rating

No. of
CAPS Ratings

Bearish
CAPS Ratings

Bear Ratio

Worldspace

1

124

108

87.1%

XM Satellite

1

539

246

45.6%

Bookham
(Nasdaq: BKHM  )

1

19

7

36.8%

JDS Uniphase
(Nasdaq: JDSU  )

2

267

59

22.1%

Sirius Satellite
(Nasdaq: SIRI  )

2

1,496

318

21.3%

Source: Motley Fool CAPS

Do you agree? Disagree? Let us know what you think by signing up for CAPS today. It's 100% free to participate.

Cap off your day with related CAPS Foolishness:

XM is a former pick of David Gardner's Motley Fool Rule Breakers growth stock service. Three of his team's formal selections have tripled, and two have quadrupled in two years. Care to find out who they are?Click hereto get 30 days of free access to Rule Breakers.

Fool contributorTim Beyers, ranked 1,177 out of 14,647 inMotley Fool CAPS, didn't own shares in any of the companies mentioned in this story at the time of publication. Get the skinny on all the stocks he owns by checking Tim's Foolprofile. The Motley Fool'sdisclosure policyis hotter than city asphalt in the summer heat.


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