Five companies remain in our high-growth study. They are:

Paychex (Nasdaq: PAYX)
Millennium Pharmaceuticals (Nasdaq: MLNM)
Genentech (NYSE: DNA)
Concord EFS (Nasdaq: CEFT)
eBay (Nasdaq: EBAY)

As you might know, the original 50 companies in the study were suggested by readers. We narrowed down the list one-by-one. Of the remaining companies, we favor Paychex, partially because it's the only company offering a Drip. Even more important than that, we understand its business and how it could continue to grow at a market-beating pace. We haven't looked closely at Paychex's valuation lately, but we will.

With a sixteen-year time frame and a strategy that uses dollar-cost averaging, valuation is less important to us, but it's still vitally important. We want our portfolio to earn at least 15% annualized, an aggressive goal. The price that we pay for companies is obviously instrumental to reaching this goal.

Paychex may have one foot in Drip Port's door, but we need to run the remaining companies under our eyes one more time to be sure. Let's take a look at three of these growth companies.

Millennium Pharmaceuticals
It's an exceptional biotech startup that has $200 million in annual revenue even before having any drugs on the market. Millennium earned $59 million in sales last quarter, and $109 million so far this year, on alliance revenue -- mainly, money paid for delivering drug targets to partners. Millennium has approximately $2 billion in contracted alliance revenue, a record for any biotech company. Millennium was founded in 1993.

This company is attempting to revolutionize medicine by discovering products that address every stage of disease on an individual level (personalized medicine based on genetic profiles) when possible. Millennium is focused on oncology, metabolic disease, and inflammation. It aims to have 12 drugs in clinical trials by the end of 2001. Its first drug for sale in the U.S., Campath for leukemia, was approved in May. Millennium currently has six drug candidates in various and sometimes multiple clinical trials, described in its pipeline information.

Millennium was valued at $15 billion at its peak about one year ago. Today, at $23, its market cap is $5 billion while its enterprise value is $3.5 billion, or 18 times sales. Remarkably, Millennium spent $94 million on research and development last quarter, yet it remained cash neutral (it didn't burn cash). It has about $1.5 billion in cash and equivalents, and with revenue on the rise, it shouldn't have any cash worries for several years even while it increases funding for new trials. It's in a good place. The Rule Breaker looked at Millennium last year in parts one and two.

Unlike the next two companies, Millennium doesn't have earnings right now, but it has plenty of long-term potential; and the stock is at a price where an investor could at least start to average in if they're interested.

Genentech is the oldest biotech company in the country, founded in 1976. On annual sales of $1.2 billion, it has a market value of $22 billion at $42 per share, or 18 times sales. 

Focused on oncology and cardiovascular disease, Genentech has one of the deepest product pipelines in the industry, if not the deepest, with 18 products in development. However, this varied pipeline doesn't mean that it'll necessarily be the most lucrative pipeline, or create the most value. Amgen (NYSE: AMGN) has just two blockbuster drugs and the company is valued at $61 billion (which is also 18 times sales).

Giant Genentech made our high-growth list because, with $1.2 billion in sales, it really isn't too giant. It has plenty of growing ahead of it, and grow it will. Management announced last year that earnings per share should grow 25% annually through 2005, an aggressive goal to say the least. That goal has since been tempered to about 20% annual growth; still impressive. Genentech's stock has had rough sailing this year, down 50%, as a few drugs in trials had disappointing results and biotechs in general have slid. The stock trades at 56 times this year's earnings estimate, and the company is expected grow earnings 21% in 2002.

Like Millennium, Genentech lacks a Drip, so investors interested in dollar-cost averaging the stock would need to do so through a low-cost broker or pseudo-Drip service, like Drip Port sponsors BUYandHOLD and ShareBuilder. Genentech is a company that I believe is worth keeping an eye on, whatever Drip Port does. Genentech should grow whatever the economy does.

Concord EFS
This stock has been a rocket since we overviewed it in March, rising 41%. Concord EFS is in the business of payment services and transactions. The company runs about one in every six ATM cash machines in the country, and it processes a large percentage of the debit, credit, and electronic benefit transactions (EBT) taking place every day. As society continually conducts more transactions by debit or credit, Concord's business continually grows.

Mike Trigg wrote an excellent in-depth article on Concord in March. Now at $57, the company is valued at $14.3 billion. It trades at 48 times this year's earnings estimate and free cash flow estimate, and it is expected to grow earnings per share 31% next fiscal year. Its sustainable advantages, as Mike wrote, provide it a premium valuation.

If Concord EFS sounds like the type of investment that might interest you, read Mike's article, and then visit the company's website.

What's next?
Concord and Genentech have definite sustainable competitive advantages and businesses that promise and can support continued growth, namely strong growth. Millennium is one of the most impressive young biotech companies in the country, and if it can reach its goal of 12 drugs in trials this year, it could soon have one of the most promising pipelines. Meanwhile, it is earning enough revenue to keep its $1.5 billion cash balance steady. That's amazing this early in the game.

All three are strong organizations and may be worth averaging into through a pseudo-Drip or buying outright (for risk-tolerant investors). Drip Port is going to pass on all three, though, for reasons explained in this post. In summary, the lack of a free Drip plan is the biggest blow to all three, but not the only blow. Millennium is very high risk still, more speculation than investing, even if smart speculation; Genentech is priced for continual success, leaving little margin of safety; and Concord is in a business that we can't know the shape of 10 years from now. By then, electronic payment systems may be based on an entirely new technology.

We pass on all three, leaving Paychex and eBay (Nasdaq: EBAY) for next week.

Jeff Fischer has used the shoulder to pass cars once or twice, but only under extreme duress or stupidity. Of companies mentioned, he holds shares of eBay. The Fool has a progressive disclosure policy.