A 1-in-100 Investor

The first 100 days in office set the tone for any new president. Similarly, Motley Fool CAPS keeps an eye on how well investors do in their first 100 days. Some of our best -- we call them All-Stars -- have achieved scores of 100 on stock selections in their first 100 days on CAPS. In this column, we're looking at our best members who made some of their best stock selections early on and seeing which ones they think will be best next.

One of our highest-rated CAPS members is TigerPack, who sports a top 99.98 member rating. A member since June 2008, TigerPack currently has 168 active picks on CAPS out of more than 1,200 stock picks made. Achieving 82% accuracy, TigerPack has attracted 229 "groupies," CAPS members who've listed this leading investor as one of their favorites.

Here are a few of this top member's most recent stock selections and how they were rated.

Source: Motley Fool CAPS.
^Price when call was made.
Current score is how many points a member is beating (lagging) the S&P500 index from the time of the call.

Let's take a look at what other CAPS members are saying about one of these stocks and whether they agree with this top player's assessment.

Degree of risk
As CAPS member maestrale points out, it's not often that the lightbulb gets reinvented, but when you have a company at the leading edge of such a development, like Cree is, investors should take notice: "Is not that often that the light bulb gets reinvented and little CREE has a great technological and IP advantage."

It doesn't hurt that alternatives to incandescent bulbs got a push from Congress' phasing out the competition. We already knew that Philips Electronics (NYSE: PHG), the world's largest lightbulb manufacturer, had been one of the biggest proponents of banning traditional lightbulbs because it was in the tank for compact fluorescents, which are a more profitable product for them. But even it realizes CFLs are just a temporary way station for the adoption of the LEDs that it and Cree make.

LEDs last longer and shine brighter, and because they're essentially little computer chips that emit light, they don't present the same problem of mercury contamination that CFLs do. The problem with more widespread adoption of LEDs is cost, and while their price is dropping, making them a better alternative for commercial and industrial situations, they haven't hit a price point that will make them ubiquitous in residential applications.

There are several risks for Cree investors, such as potential oversupply conditions that could impact pricing, or, as highly rated CAPS All-Star JakilaTheHun points out, margin compression even as revenues ramp up:

Great company in a great and growing industry, but getting very, very pricey; particularly in an commoditized industry that should have a glut of capacity by 2011. The risk here is that growth in LED lighting increases CREE's revenues so much that earnings skyrocket upwards over the next 5 years and drive the price even higher than the current $62 price point. But I'm betting against that. My view is that revenues will grow, but margins will shrink over the next 5 years.

Cree is the leading pure play in the business, but with the market valuing it at more than 90 times trailing earnings (and around 35 times 2011 estimates), it seems a lot of its growth potential is priced into the stock.

More than 900 CAPS members have weighed in on Cree's future, with more than 88% seeing it outperform the broader market averages. Head over to the Cree CAPS page and light up the place with your own opinion.

A 1-in-100 opportunity
Some of the best and smartest members in the CAPS investor-intelligence community have made their mark, but it pays to start your own research on these stocks on Motley Fool CAPS. 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.

As hockey great Wayne Gretzky once noted, "You miss 100% of the shots you never take." At Motley Fool CAPS every investor's opinion counts and since it's free to sign up, why not use this opportunity to take your best shot?