Tomorrow's Monster Stock?

Recs

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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 over the past decade. These aren't penny stocks; they're viable companies that have sound business prospects and achieve phenomenal returns every year. Finding just one or two of these monstrously successful companies can help you establish a winning portfolio.

Stalking the monster
To find tomorrow's winners, we've enlisted the help of more than 135,000 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.

Player

CAPS Member Rating

Monster Stock

CAPS Score

Recent Stock Pick

CAPS Rating (Out of 5)

BravoBevo

100.00

Morgan Stanley

263.06

Sonus Networks (Nasdaq: SONS)

****

fransgeraedts

99.99

Prudential Financial

213.02

Navios Maritime (NYSE: NM)

*****

vanamonde

99.98

Genworth Financial (NYSE: GNW)

249.48

Force Protection (Nasdaq: FRPT)

***

drewbink

99.54

The9

226.83

LHC Group (Nasdaq: LHCG)

***

kadken

99.52

TBS International

489.74

Decker Outdoors (Nasdaq: DECK)

**

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.

In search of Bigfoot
The loss of the $1.1 billion MRAP contract to Oshkosh (NYSE: OSK) is a bit of a blow to Force Protection, but it doesn't mean the military contractor has lost all growth opportunities. Just days after the MRAP award, Force Protection was given a $77 million contract for independent suspension kits for its Cougar MRAPs. Although that's a much smaller revenue stream, it highlights that the company's expertise is still essential and in demand.

Furthermore, there's always the possibility that Force Protection could be awarded a subcontract by Oshkosh for certain aspects of the MRAP build. With the stock sitting at 7.2 times trailing earnings and 8.5 times forward earnings, the market appears to be taking a very dim view of Force Protection's prospects. Yet there's $120 million in cash, no long-term debt, a new Kuwait-based logistics and service depot, and other business lines.

Some investors remain impressed with the company's ability to maintain a solid financial condition. Among them is CAPS member Man0fAdventure, who wrote just a few days ago, "Good balance sheet and at a good price due to a selloff for losing a contract to [Oshkosh]."

Without question, the 2,200-vehicle MRAP contract would have been a big boon to Force Protection's business, but the company is still expecting a stronger second half of the year because of its other lines of business.

It's been a tough month nonetheless for the companies making up the CAPS Defense sector -- they've lost about 12% on average this past month. They just haven't had it as bad as Force Protection, which has lost nearly 40%.

A chance for scary growth
It takes more than a few All-Star picks and a quick paragraph to make buy or sell decisions, so start your own research on these stocks on Motley Fool CAPS. You can 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. And while you're there, weigh in with your own thoughts on whether you think these are tomorrow's monster stocks.

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Fool contributor Rich Duprey has no financial position in any of the stocks mentioned in this article. You can see his holdings. The Motley Fool has a disclosure policy.

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On July 15, 2009, at 1:30 PM, BigBeaverotc wrote:

    Mr. Duprey needs to better homework before he writes one of these articles. That $77 million FRPT contract was a step backward for the company. It was for the installation of OSK's TAK-4 suspension on the Force Cougar MRAP. The same suspension on the OSK MATV and a big reason OSK won the MATV competition. The DOD is showing a large preference for the OSK TAK-4 on MRAP's. It gives the truck better off-road capabilities. The military is retrofitting them onto FRPT Cougar trucks in the Middle East. FRPT is pretty much a 1 trick pony and they lost part of their trick. I think this company is going need strong foreign military sales in the future to see sales growth.

  • Report this Comment On July 15, 2009, at 6:16 PM, jrusso9722 wrote:

    As the provider of many, many MRAPS that are going to need rehabilitation, Force Pro is in good stead to participate in this eventual award. Yes, Oshkosh TAK-4 sets the standard for suspension systems-crucial for our warfighters, but, there is a huge opportunity in overhaul/rehabilitation that is entirely within FRPT's realm. With all due respect, $77 million represents an attempt by DOD to protect FRPT, going forward, until another award can be made for maintenance and upgrades on MRAP. DOD is not going to see FRPT disappear. I agree that strong foreign military sales is necessary for sales growth. However, just 4 months ago, OSK was below $4.00 and losing support from Junior Varsity Financial Planners who thought they knew what was happening. Long term holding of good stocks is best for investment gains. You make money when you buy, not when you sell. Regards, Joe

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12/1/2009 12:41 PM
GNW $11.17 Up +0.40 +3.71%
Genworth Financial… CAPS Rating: ***
LHCG $31.43 Up +0.66 +2.14%
LHC Group, Inc. CAPS Rating: ****
SONS $2.19 Up +0.01 +0.46%
Sonus Networks, In… CAPS Rating: ****
OSK $40.37 Up +0.64 +1.61%
Oshkosh Corporatio… CAPS Rating: **
DECK $94.45 Up +1.82 +1.96%
Deckers Outdoor Co… CAPS Rating: ***
FRPT $5.13 Down -0.03 -0.58%
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NM $6.02 Up +0.24 +4.15%
Navios Maritime Ho… CAPS Rating: *****

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