Penny stocks can make you rich. Need proof? Every one of these multibaggers was once a penny stock:

Company

Recent Price

CAPS Stars (5 Max)

5-Year Return

GigaMedia (NASDAQ:GIGM)

$6.07

*****

333.6%

VASCO Data Security (NASDAQ:VDSI)

$5.60

*****

180%

Denbury Resources (NYSE:DNR)

$17.52

*****

363.5%

Arena Resources (NYSE:ARD)

$30.06

***

816.5%

Transcend Services (NASDAQ:TRCR)

$9.69

***

148.5%

Sources: Motley Fool CAPS, Yahoo! Finance.

The promise of outrageous returns has periodically made even the world's best stock pickers penny stock investors. Peter Lynch has and still does enjoy the stock market's super-cheap seats. The Royce Low-Priced Stock fund has beat the market for a decade by betting on stocks trading near or below $10 a share, including Pan American Silver (NASDAQ:PAAS).

Even the All-Stars in our 130,000-plus Motley Fool CAPS community take to penny stocks. More than a few have been richly rewarded.

Pennies from heaven
So why not invest in penny stocks? I suppose because the SEC has warned us about them. But what if we take the agency's definition literally, and limit our choices to stocks trading between $1.50 and $5 a share? And what if we further limit our choices to four- and five-star stocks with market caps between $250 million and $2 billion? Surely our CAPS screener would return some winners, right?

This week when I ran it, 79 stocks made the cut -- including our last topper, Gerdau AmeriSteel. Let's move on to another would-be commodities champ, Thompson Creek Metals (NYSE:TC). Look at how it's attracting the bulls in our CAPS community:

Metric

Thompson Creek Metals

CAPS stars (5 max)

*****

Total ratings

668

Percent Bulls

97.9%

Percent Bears

2.1%

Bullish pitches

116 out of 117

Commodity prices have taken a beating recently and, reading the tealeaves, there's every reason to believe that we have yet to hit bottom. Take steel. Prices of hot-rolled coil have more than halved since June, reports U.K. trade magazine Metal Bulletin.

You'd think that would be bad news for Thompson Creek. And it still may be. But CAPS All-Star MattH42004 says the company's margins should prove recession-resistant. Quoting from his January pitch:

Thompson Creek is a slightly speculative stock that has the ability to generate massive returns to patient investors. The company mines Molybdenum, a specialty metal used to make especially high strength and corrosion resistant steel. TC's current production cost is around $7 a pound, with current spot prices around varying around $10 TC is still able to be profitable even at incredibly depressed levels.

And if that can't continue? Roughly 50% of Thompson Creek's market value is denominated in cash and liquid investments. Thus, investors buying at current levels shouldn't see much additional downside.

But that's my take. I'm far more interested to know what you think. Would you buy Thompson Creek Metals at today's prices? Let us know by signing up for CAPS today. It's 100% free to participate.

See you back here next week with another penny stock from heaven. Fool on!