Investors are always hunting for the next big stock -- the dream stock whose price increases several times over when the market finally discovers it. It's easy to look back and discover the 10 best stocks of the past decade. But I'm more interested in the tools that can help me evaluate tomorrow's greatest companies.
Motley Fool CAPS offers a variety of resources to aid Fools in finding tomorrow's leaders. Our 140,000-member community is full of investors helping each other beat the market.
We'll enlist CAPS to screen for energy companies, then get the story behind some of its more highly rated stocks. CAPS' nifty screener will help us find stocks with:
Then we'll tap the collective intelligence of our CAPS members to see whether these companies present real opportunities -- or whether the numbers fail to tell the true story.
Opinions with the numbers
Below is a sample of stocks our screen returned. You can run this screen yourself -- remember, though, that your results may differ from ours as the market changes.
|
Company
|
Revenue Growth Rate,
Past 3 Years
|
CAPS Rating
(out of 5)
|
|
WSP Holdings (NYSE: WH )
|
53.3%
|
*****
|
|
Allis-Chalmers Energy (NYSE: ALY )
|
41.4%
|
*****
|
|
Western Refining (NYSE: WNR )
|
31.8%
|
****
|
Data and star rankings from CAPS as of Sept. 25.
WSP Holdings
While still remaining profitable, Chinese oil drilling equipment maker WSP Holdings reported a 29% fall in second-quarter revenue due to weaker exploration operations of petroleum companies and low demand in the U.S., its biggest international market. Domestic sales grew 61%, though, and it plans to expand in markets outside of North America to offset the decline. It recently won contracts from China Petroleum & Chemical and PetroChina (NYSE: PTR ) and looks for improvement in domestic demand in the second half. While some investors are concerned about risks to operations in a down economy, many CAPS members like its low valuation and strong dividend yield as 95% of the 282 members rating the firm expect it to beat the broader market.
Allis-Chalmers Energy
Echoing the sentiment of many others in the oil and gas business, oilfield services company Allis-Chalmers gave a rather grim outlook for the remainder of 2009 in its recent quarterly report. The number of its active rigs drilling in the oil and gas industry remains low compared to last year, and its revenue is directly correlated to the rig count. In addition, many of its customers are still spending less as a result of low natural gas prices. But thanks to a backstopped rights offering and private placement in June, the company has increased its cash balance to close to $60 million and it's repaid nearly $75 million of its large debt load. Even with a poor near-term outlook, CAPS members rate the company five stars and think it may perform well in the long term -- nearly 98% of the 761 members rating Allis-Chalmers Energy are bullish today.
Western Refining
Many CAPS members are taking a long-term view on Western Refining, looking past the short-term pressure that has refiners like Valero (NYSE: VLO ) and Tesoro (NYSE: TSO ) working with slashed budgets. Goldman Sachs (NYSE: GS ) recently upgraded its view of the sector, saying that the refining cycle is moving through its trough, but still cautioned on excess capacity. Western Refining has pulled in positive free cash flow over the past twelve months though and some investors like its low valuation today. CAPS members are particular fans as 316 out of the 327 All-Stars rating the company expect it to outperform the S&P.
Let 140,000 members be the jury
The collective wisdom of a huge pool of investors can help give context to a page of numbers from a stock screen. But individual investors are still the best judges of what to do with their own money. Fools should always perform their own due diligence.
And it's easy to chime in with your own opinion. If you agree that these companies present dream opportunities -- or see more of a nightmare instead -- simply scroll down and add your comments in the comments box.
The Motley Fool Stock Advisor service looks for companies with strong management poised to beat the market over the long haul. To see all the stocks that have helped Tom and David Gardner beat the market by 49 points on average, take a free 30-day trial.
RSS Headlines
Fool UK