By
Anders Bylund
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More Articles
January 4, 2007
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Did you know that five of the companies reporting earnings this week have been given the highest grade possible by our own investment community? Motley Fool CAPS players have bestowed five stars on each of these businesses, and although they may look wildly different at a first glance, there's a common thread tying them all together. Have a look at our all-stars on stage this week:
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Company
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CAPS Rating
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Market Cap (Millions)
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Analysts Covering
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Industry
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Texas Industries (NYSE: TXI )
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*****
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$1,540
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0
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Building materials
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Landec (Nasdaq: LNDC )
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*****
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$269
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4
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Specialty polymers
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Xyratex (Nasdaq: XRTX )
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*****
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$620
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0
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Storage networking
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Acuity Brands (NYSE: AYI )
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*****
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$2,240
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5
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Lighting equipment
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Neogen (Nasdaq: NEOG )
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*****
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$204
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2
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Food safety testing
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All of these stocks look like poster children for the Motley Fool Hidden Gems service. Like the treasures unearthed monthly by Fool co-founder Tom Gardner and his team at Hidden Gems, these companies are all small, boring, short on mainstream interest, and long on promise.
Specialty packaging expert Landec, for example, is growing profits like nobody's business -- 61% year-over-year at last count -- and the stock price is following suit, with 46% appreciation in the last 12 months. Acuity Brands is an established market leader in an unloved sector. Its shares are value-priced at just 1 times sales, while its closest competitors are fetching about 1.7 times trailing revenues. And many of Neogen's testing products don't have any meaningful competition. Protected by a solid patent portfolio, this upstart with a 25-year operating history should have a straight shot at amazing returns.
Any of these companies could become the next Portfolio Recovery Associates (Nasdaq: PRAA ) . Who, you say? It's another small, boring five-star company. The debt-collection specialist has returned 83% to Hidden Gems subscribers who bought in when it was first recommended in the summer of 2004. Or there could be another Middleby (Nasdaq: MIDD ) in the bunch. That selection has rewarded investors with 467% returns since the commercial oven manufacturer was first singled out in November 2003. And yes, it's still a five-star stock.
You just never know where these kinds of opportunities are going to pop up. The problem is finding them among the more than 7,000 publicly traded stocks. Let the Hidden Gems team do the hard work for you by grabbing a free 30-day ticket to that ride today. You won't believe some of the small, obscure companies you'll find inside -- and the astonishing market returns they have produced.
Further Foolishness:
Time's running out on the 2006 Foolanthropy charity drive. Five charities are competing for donations, with the one raising the most money by Jan. 7 earning an additional $10,000 from the Fool. Please consider giving to these worthy causes, and thanks for your support.
Fool contributor Anders Bylund holds no position in any of the companies discussed here. You can check out Anders' holdings if you like, and Foolish disclosure is always worth a read.
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