America's Next Top Growth Stock

Growth stocks are the beauties of the stock world, plain and simple. They're exciting, they have good stories, and they can make you a lot of money.

But for all their beauty, growth stocks are also the prima donnas of the market. They can be erratic, they don't always live up to their billing, and they tend to attract a shareholder base that's ready and willing to run at the first signs of slowdown. For those reasons, caution is certainly in order when you enter the world of growth investing.

Fortunately, The Motley Fool's CAPS service brings us the collective intelligence of a community of more than 145,000 investors and is a great resource for separating the Jessica Albas from the Jabba the Hutts. Each of the stocks competing for this week's top spot has a market cap of at least $100 million and grew its earnings per share by an average of 15% or more per year over the past three years. (You can run the screen for yourself to get updated results.) Let's go ahead and meet our contestants.

Sources: Yahoo! Finance and CAPS as of Nov. 25.

Growth without good looks
Advanced Battery has certainly seen significant growth in recent years. Revenue over the past 12 months is more than 12 times what the company reported in 2005, and it has gone from being a money-loser to showing significant profits.

However, over the past 12 months the company's operating profit has fallen despite continued top-line growth. So maybe we can't blame CAPS members for being a little skeptical of this small Chinese battery manufacturer.

While CAPS members give SunPower one more star than Advanced Battery, it still garners only a mediocre three-star rating. In a crowded solar industry where the company has to compete with the likes of Suntech Power (NYSE:STP) and First Solar (NASDAQ:FSLR), it seems that SunPower just doesn't wow CAPS members. The company's 50%-plus drop in net income over the first nine months of this year can't have helped.

Strutting their stuff
With four stars, both McDonald's and Accenture are in the upper echelons of CAPS stocks. While neither has grown as fast in recent years as other companies on the list, both have size, stability, and brand power that most companies can only dream about.

Mickey D's and Accenture have market caps of $68 billion and $25 billion, respectively, and their size will work against them when it comes to chalking up blazing growth. However, both companies have been busy taking advantage of new opportunities in high-growth emerging markets.

But even though McDonald's and Accenture are some foxy-looking stocks, neither could top this week's top growth stock: Atwood Oceanics. So what is it about Atwood that makes CAPS members think it's one of the most beautiful stocks in all the land?

Let's take a look at what All-Star themattgrdt had to say last month when giving the stock a thumbs-up:

I've always been a fan of the offshore drillers. ATW's one of my favorite's because of its deepwater fleet. As long as oil prices stay above $60-$70, they should be pretty profitable for the next few years. The downside is it's a capital intensive industry, so not a lot of FCF, which is usually what I like to see.

Now go vote!
Do you think that Atwood has what it takes to be America's next top growth stock? Head over to CAPS and let the rest of the community know what you think.

Growth is great, but cheap can score big for you, too. Check out the stock that Tim Hanson thinks is outrageously cheap.