In the competitive spirit of college basketball's annual championship tournament, The Motley Fool brings you Stock Madness 2007! Our writers are making head-to-head arguments for their chosen stocks (but not necessarily investment recommendations -- this is, after all, a game), and you'll pick the winners with your article recommendations and Motley Fool CAPS ratings. Who will win the right to cut down the net? Let's tip things off and find out!

Welcome to the Final Four. In this game, it's Stock Advisor pick Marvel Entertainment (NYSE:MVL) versus Global Gains recommendation Sasol (NYSE:SSL).

And that puts me in a tough spot. Sasol is a strong company that, on an absolute basis at least, is far cheaper than Marvel. But that shouldn't bother you. Why? Marvel faces fewer risks and offers more growth potential.

Beware the box-and-one
Let's address risks first. Allow me to quote from the latest Sasol earnings release:

"Sasol Synfuels achieved an increase in operating profit of 14% to R 360 million primarily because of higher oil prices and a weaker rand. Production volumes were 7% lower as a result of the four-yearly shutdown of one half of the total plant, the start-up of the Synfuels Catalytic Cracker and some production interruptions. Operating costs have increased as a result of the need to import fuel components, as well as higher coal and natural gas costs." [Emphasis mine.]

I'll grant that Sasol's coal-to-liquid process is interesting. I'll even grant that it's a disruptive technology. My problem is that everyone likes the alternative fuel business. Sasol, facing production problems and a potential windfall profits tax in its home country of South Africa, may be the riskiest of the bunch.

Not so with Headwaters (NYSE:HW), which is a Rule Breakers pick. My math says that today's investors are getting the promising alternative energy portion of the business for less than $3 a share.

Fast break with a Rule Breaker
Then there's Marvel, which we already know is a true Rule Breaker from your votes in the previous round. To review:

  • Marvel is a top dog and first mover as a content creator opening a movie studio.
  • It has a massive advantage in the form of 4,000 copyrighted characters for new films and an extremely profitable research and development  division.
  • The stock has been an eight-bagger since David Gardner first singled it out in the July 2002 issue of Stock Advisor.
  • Marvel owns one of the most recognized superheroes ever in Spider-Man, who will again grace the big screen in May. (Heck, Marvel is so well-known that Captain America is being welcomed in Dubai.)
  • Management's motto -- "less meetings, more productivity" -- is exceedingly shareholder-friendly, like a point guard who rarely turns the ball over.
  • And, finally, it's easy to find Marvel bears.

Hulk will smash the backboard
But that's probably not enough to earn your vote. Hey, I understand. That's why we're going to debunk the idea put forth by Professor Positive Bill Mann and his sidekick Smiling Lad Joe Magyer that coal-to-liquid fuel is somehow the world's greatest catalyst.

Allow me to introduce Dr. Bruce Banner. He'll be appearing in theaters in June 2008 under the guise of his more familiar alter ego, The Incredible Hulk. Four years ago, the green-skinned giant took in $132 million at his domestic box-office debut.

Had he starred in a self-funded flick rather than one produced by News Corp.'s (NYSE:NWS) 20th Century Fox, Hulk would have provided roughly over $30 million in operating profit at the time.

But that's peanuts. Hulk's reprisal could earn far more than that if it beats $132 million in gross receipts. I think it will for two reasons. First, the new film won't be a character study, like Ang Lee's original. Second, sequels almost always do better when it comes to Marvel films.

And if Hulk truly smashes the box office, earning the $234 million domestically that X-Men: The Last Stand did? Marvel could see -- wait for it -- more than $150 million in additional operating profit. The comic book king earned $111 million in operating income over the trailing 12 months since December.

There's an element of "what if?" to both Sasol and Marvel. For Sasol, widespread adoption of coal liquefaction could unlock years of growth. For Marvel, self-financed films could more than double its historic operating profits.

So why am I asking for your vote? Gravity. Sasol and its $21.2 billion market cap is roughly 10 times the size of Marvel. Bill, who with Tom Gardner leads our market-beating Motley Fool Hidden Gems small-cap service, knows as well as anyone that growth will always have a greater impact on smaller firms. Call it stock market gravity at work; it pulls harder on the larger mass -- in this case, Sasol. That's why Marvel, the nimbler of our two combatants here, should have a shot at the Stock Madness title.

Convinced? If so, follow this link and rank Marvel to outperform in Motley Fool CAPS.

Read our opposing article on Sasol, or see all of the other entries in this tournament. Our editors will tally your votes to determine which stocks will advance one step closer to the title.

Do you think you could pitch your favorite stock -- or ditch your least favorite one -- in less than 27 seconds? That's what we're doing over at Motley Fool CAPS. Check out our new stock videos.

Fool contributor Tim Beyers, who is ranked 784 out of more than 25,200 in our Motley Fool CAPS investor-intelligence database, still owned more than 2,000 comic books but no shares in any of the companies mentioned in this article at the time of publication. His holdings can be found at Tim's Fool profile. His thoughts on Foolishness and investing may be found in his blog. The Motley Fool's disclosure policy is a hero to your portfolio.