Tomorrow's Monster Stocks

Famed money manager Peter Lynch called them "10 baggers," stocks that climbed to 10 times the value he paid for them. They're a rare breed, but not impossible to find. Especially when you're a friend to Fools.

If you look back over the market's best stocks, you'll find companies that have risen in value over the past decade by 3,000%, 5,000%, and even 24,000%. They're not penny stocks, but viable companies with sound business prospects, companies that are achieving phenomenal returns every year. You only need to pick one or two monster stocks to have a winning portfolio.

Stalking the monster
So where can we find tomorrow's monster stocks today? At Motley Fool CAPS, we track the opinions of more than 65,000 investors who are working every day to help each other identify those winners. Thousands of stocks are rated by both novice and professional analysts. The opinions of the best stock pickers are weighted more heavily in determining a stock's CAPS rating of one to five stars, with five being the best.

Investors at CAPS are rated as well, and we call the best of them All-Stars. We've compiled a list of these top players who, like Peter Lynch, have already found monster stocks -- companies that have doubled, tripled, or quadrupled in price -- and given you some of their recent picks of stocks they think might do just as well.

Of course this is not a list of stocks to buy -- or, for those monster stocks that the CAPS All-Stars have already found, sell -- it's a jumping-off point for doing additional research.

The bull case for Sasol
This South African company is an integrated oil, gas, and petrochemical company that is making a big bet on coal-to-liquid fuels. It's attracted quite a few top-rated CAPS players too, like StockSpreadsheet, who ranks higher than more than 93% of all players. While enumerating a number of fundamental metrics that make Sasol a winning company, he also highlights the market opportunities in his top-rated bull pitch, "I really like the coal-to-gas and coal-to-liquid technologies of this company since the U.S. has lots of coal and needs more oil and natural gas and this company has technologies that can make the bridge between what we have and what we need."

With a 99.83 player rating, All-Star jester112358 says:

The coal to chemical and gas conversion process is one of the most reasonable transitional approaches to a pure hydrogen or solar driven economy which will realistically require considerable government subsidies over the next 10-30 years to have even a minor energy impact. This company has been producing useful transportation fuels and chemicals from coal for over 20 years. There's lots of room to grow this underutilized source, especially in view of crude oil refinery capacity limitations. Its current price is a bargain. The issue of the political stability of South Africa is really the only long-term stability issue. But this also applies to China and India.

With a market multiple in line with its industry, the Motley Fool Global Gains recommendation offers a relative value compared to competitors. However, aesthetic-laser maker Palomar Medical Technologies sports a P/E ratio at least half of what its rivals command. Might that make it the better value of these two highly rated companies?

A chance for scary growth
Now's the opportunity for you to weigh in on Sasol and Palomar, or any of the other stocks these All-Stars see as achieving monster growth. Agree with their views? Tell us on CAPS. If you don't agree, let us know that too! This is the place where your voice counts just as much as everyone else's.