Tomorrow's Monster Stock?

Stocks that climb to 10 times their original price are rare breeds. But they're not impossible to find -- especially when you have Fools for friends.

The market's best stocks include companies that have risen dozens of times in value over the past decade. These aren't penny stocks; they're viable companies that have sound business prospects and achieve phenomenal returns. And they happen to share some common traits: They're small, obscure, and ignored. Finding just one or two of these monstrously successful companies can help you establish a winning portfolio.

Stalking the monster
To find tomorrow's winners, we've enlisted the help of more than 135,000 monster trackers at Motley Fool CAPS. We've compiled a list of the most successful CAPS members, dubbed All-Stars, whose picks have doubled, tripled, or even quadrupled in price. Then we've plucked out some of their recent picks for stocks they find equally promising.

Player

CAPS Member Rating

Monster Stock

CAPS Score

Recent Stock Pick

CAPS Rating (Out of five)

BravoBevo

100.00

Fuqi International

231.99

Huron Consulting (Nasdaq: HURN  )

**

hdgf2

99.99

Ford

192.03

AMAG Pharmaceuticals (Nasdaq: AMAG  )

***

TigerPack

99.99

Gannett

129.84

Dell (Nasdaq: DELL  )

**

tenmiles

99.99

Synthesis Energy Systems

138.98

Electro-Optical Sciences (Nasdaq: MELA  )

****

bullishbabo

99.98

Sync2 Entertainment

105.45

Pharmaceutical Product Development (Nasdaq: PPDI  )

*****

Of course, this is not a list of stocks to buy -- or, for those monster stocks that our CAPS All-Stars have already found, sell. Just consider them starting points for your own further research of extreme buying opportunities.

In search of Bigfoot
You've gotta hand it to Dell. For a company that was once synonymous with computers, it's done a pretty good job of fumbling its good fortune. Now Dell is the runner-up to Hewlett-Packard (NYSE: HPQ  ) , a company that also could teach a class or two on how to screw up big time

Dell seems to have been especially adept at tripping over its own motherboard. After squandering the lead in PCs, it thought portable media players and HDTVs provided its next growth opportunity, but not netbooks, thus leaving the field wide open for Acer and Asus. (Granted, I didn't think tiny, underpowered laptops would amount to much either.) Now the company is launching a smartphone. What is Dell thinking? Should you just throw this stock away?

I'd say you should hang on, because Dell just might dial up some serious growth here. The blogosphere is all atwitter that a Dell smartphone running Google's Android is about to drop in China any day now. Smart move, that. China's handset market grew by 9% in the first quarter, according to the market researchers at iSuppli, with as many as 239 million units to be shipped in total this year. If Dell pairs up with China Mobile (NYSE: CHL  ) , as one of the rumors out there claims, then it will be tapping into China's largest operator, with more than 450 million subscribers.

In contrast with its straw-grasping rationale that peripherals would make a logical leap for a computer maker, Dell surely realizes that mobile handsets are very much mini-computers these days. Furthermore, Dell can make a respectable showing with a handset and not have to try to unseat either Nokia or Samsung, which are the largest players in China's market, with a 34% and 21% share, respectively. A Dell cell phone could carve itself a nice niche.

Meanwhile, Gartner says Dell's computers have grabbed an 8.5% share of the Chinese market (it was a late entrant in that arena, too) and that the company was one of 14 to win a spot on China's rural subsidy program for computers. And we also have a new version of Windows 7 set to launch in October. With all of these things in mind, CAPS member kidwolf908 thinks Dell will be able to offer up some fancy footwork again.

Dell has been battered by the economy and the tech slump, but as consumer confidence strengthens and spending increases, people will be looking to pick up new PC's and monitors thanks to the release of Win7. With the netbook craze wearing thin and the ultralight notebook market looking to pick up, I think Dell is in a good position with an array of 12-14" notebooks.

A chance for scary growth
It takes more than a few All-Star picks and a quick paragraph to make buy or sell decisions, so start your own research on these stocks on Motley Fool CAPS. You can read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made -- all from a stock's CAPS page. And while you're there, weigh in with your own thoughts on whether you think these are tomorrow's monster stocks.

Google is a Motley Fool Rule Breakers pick. Pharmaceutical Product Development is a Motley Fool Stock Advisor recommendation. Dell is a Motley Fool Inside Value selection. Try any of our Foolish newsletter services free for 30 days.

Fool contributor Rich Duprey has no financial position in any of the stocks mentioned in this article. You can see his holdings. The Motley Fool has a disclosure policy.


Read/Post Comments (3) | Recommend This Article (9)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On August 10, 2009, at 5:29 PM, DougRichardson wrote:

    In reference to your comment "Now Dell is the runner-up to Hewlett-Packard (NYSE: HPQ), a company that also could teach a class or two on how to screw up big time. " Really, you see HP as a company that has "screwed up big time"? Maybe this is why you're a writer and not a player.

  • Report this Comment On August 11, 2009, at 9:16 AM, CubanMustGo wrote:

    Adding to what DougRichardson said, the article you link regarding HP allegedly "screw[ing] up big time" is SEVEN YEARS OLD. So what have the two companies done since then?

    Go ahead, buy Dell stock. There are plenty of bagholders out there who will thank you.

  • Report this Comment On August 11, 2009, at 3:45 PM, dokkeith wrote:

    I see Dell's line diminishing rapidily. This Fool predicts a

    50% price cut by next year. Think of Dell as the Ford of cars. My latest laptop has a broken hinge after 6 months...the plastic is warping ...I feel like i bought a lemon. And this stock is surely no apple.

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