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 have Fools for friends.

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 need to pick only 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 78,000 investors who are working every day to help collectively 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 the maximum five stars.

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. Then we've given you some of their recent picks for stocks they consider equally promising.

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.

Bright opportunities
Solar energy continues to be an area where CAPS investors seek to profit from harnessing the sun's power. Many players achieved significant gains by betting early on the demand for First Solar's electric power modules. Now Chinese solar play Yingli Green Energy has caught their eye. Despite being a relative newcomer to the market, Yingli has been able to cement new supply contracts of polysilicon, the substance used to maker solar wafers. That's great news, because polysilicon manufacturers have had difficulty keeping up with demand, creating a supply crunch for some solar companies. But coupled with its technology that reduces the amount of polysilicon needed in production, Yingli seems set for the immediate future.

Of greater concern to Yingli and the rest of the industry is whether Congress will extend solar energy tax credits past the end of 2008. (The House passed a bill that would have done so, but the Senate removed the tax credit provisions from its energy bill.) While in the past, these tax credits have been retroactively extended, it's hard for potential consumers to make decisions based on an uncertain future.

CAPS investor AnomaLee thinks that despite the stock being richly valued, the fundamentals underlying the company look solid:

I am comfortable holding onto this among supply concerns. I think YGE is one of the most solid solar plays. They are not controlled by the Republic of China, there is high inside ownership, they have a complete vertically integrated manufacturing process, they have ... signed supply deals to help solidify their growth, and there is a HUGE demand for their product.

Beware that [Yingli] Green is currently trading @ a 230 P/E! But, they are putting that money from their IPO into good use. This has been one of the few rule-breaking stocks that I actually bought into, and completely goes against my typical value approach to entering into any position, but I do sometimes buy into growth and I definitely will play momentum and bail. Even @ this ridiculous valuation I still think it will be a long, wild and choppy run for this stock to go much higher.

Yet a number of players, like CAPS All-Star lovesaves, think that the entire solar industry is destined for a fall: "Solar is an overbought sexy bubble. Many many years before we see these companies return profits, if ever."

A chance for scary growth
Now's the opportunity for you to weigh in on Yingli 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! Let's hear if you think these are tomorrow's monster stocks.  

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