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5-Star Stocks Poised to Pop: Ceradyne

Based on the aggregated intelligence of 120,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, ceramic products maker Ceradyne (Nasdaq: CRDN  ) has earned a coveted five-star ranking. Our data has shown that five-star stocks outperform the market by a significant margin; conversely, one-star stocks have woefully lagged the market average.

With that in mind, let's take a closer look at Ceradyne's business, and see what CAPS investors are saying about the stock right now.

Ceradyne facts

Headquarters (founded)

Costa Mesa, California (1967)

Market Cap

$600.34 million

Industry

Industrial Equipment and Components

TTM Revenue

$732.68 million

Management

CEO Joel Moskowitz

CFO Jerrold Pellizzon

Return on Capital (average last three years)

23.3%

Competitors

Kyocera (NYSE: KYO  ) ,

General Electric (NYSE: GE  )

CAPS members bullish on CRDN also bullish on

Apple (Nasdaq: AAPL  ) ,

Vale (NYSE: RIO  )

CAPS members bearish on CRDN also bearish on

General Motors (NYSE: GM  ) ,

Dell (Nasdaq: DELL  )

Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS. TTM = trailing 12 months.

Over on CAPS, fully 1,349 of the 1,385 members who have rated Ceradyne -- some 97% -- believe the stock will outperform the S&P 500 going forward. These bulls include kmorley123 and djwhr1.

Last month, kmorley123 had this to say of Ceradyne:

While Ceradyne is best known for body armor, they also manufacture ceramic rods used in the nuclear industry. The share price is ridiculously low right now due to the winding down of the Iraq war, uncertainty over what a democratic president might do to defense budgets and the general stock market funk.

Nevertheless, we are still in a war in Afghanistan and I don't see the military cutting back on body armor. Nuclear is enjoying some renaissance.

In a more recent pitch from earlier this month, djwhr1 agrees, writing:

This company is very well managed with competent and forward thinking leadership. Very small float stock. ... The need for individual body armor will continue and they have some unknown but possibly great potential in vehicle armor. In addition, they have some huge potential growth areas on the horizon. Stock is a buy at current prices.

What do you think about Ceradyne, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 120,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Ceradyne is a Motley Fool Rule Breakers pick, Apple and Garmin are Stock Advisor selections, and Garmin is a choice of Global Gains. The Fool's disclosure policy always gets a perfect score.


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2/14/2012 4:00 PM
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