Successful investing requires you to think independently and stick to your convictions. That's hard enough with stocks that are generally popular -- after all, in the stock market, there's a seller for every buyer. But it gets even tougher with stocks that can't seem to find good press or bullish investors anywhere. Of course, defying popular opinion has led many contrarian investors to great returns.
In that spirit, I've headed to Motley Fool CAPS to dig up some unloved stocks that have delivered big gains to shareholders over the past month. Our community of investors has put each of these companies on the bottom two rungs of the CAPS rating scale:
|
Stock |
30-Day Return |
1-Year Return |
Current CAPS Rating |
|---|---|---|---|
|
DryShips |
38.2% |
182.6% |
** |
|
Rambus |
26.8% |
16.3% |
** |
|
Ford |
26.2% |
(3.8%) |
** |
|
Pier 1 Imports |
23.7% |
(3.1%) |
* |
|
Athrocare |
20.7% |
1.5% |
* |
|
Sprint |
16.6% |
(62.0%) |
** |
|
Palm |
14.5% |
(37.0%) |
* |
Now, given CAPS' knack for accurately gauging winners and losers, I'm not recommending that you run out and buy these stocks! An index set up to short CAPS' least-liked stocks has outperformed more than 98% of all other CAPS players. That said, CAPS players have proved overly negative on some high-performing stocks. Are any of the stocks in the table above the same sort of undercover rockets?
Providing the pep
You may notice that Ford's run-up above is through Wednesday, so it doesn't include the jubilant reaction to the company's first-quarter profit on Thursday.
[Reader: Did he say profit? He must be mistaken. Pigs have yet to take flight, so he must've meant that Ford reported a smaller loss.]
No, my dear reader, I was not mistaken in penning "profit" -- Ford did, in fact, post a shocking $100 million profit in its first quarter. The black ink reverses a $282 million loss that the company took in the first quarter of last year, and breaks an almost unbroken string of losses that dates back to 2005.
The headline from Ford's press release reads "Ford makes solid progress on plan." Could it be? All I know is that somewhere Rudy is smiling.
Combing CAPS
CAPS has not been a hospitable place for Ford's stock. Though it has received more than 2,500 outperform ratings, its 1,900 underperform ratings have held it to just a two-star rating. Many players aren't convinced that one quarter of profit means they should change their tune, either. GunnarVagotis noted:
American auto makers have been resting on their laurels for years all the while getting coddled by the White house. They are getting to the fuel efficiency trend late and again, the US government is giving them until forever to get to where the rest of the world was years ago...If they dug up their electric car designs then perhaps we would have some reason to think that Ford could escape the cycle they are in of hemorrhaging on the balance sheet and churning out the same old cars.
Others, however, are part of the more optimistic tide. Matangolas rated Ford an outperformer and shared:
Excellent quality product. Very loyal following amongst pick-up truck buyers. Midway through very tough downsizing and restructuring. Management seems to have a grip on situation and turnaround plan appears to be solid and well thought out. May benefit from the new "buy American" philosophy. Also has large stake in Mazda which also produces a very fine line of imported autos.
So what's your take? Is there good reason to get more bullish on Ford right now, or are its banking days numbered? Head on over to CAPS and let the community of more than 98,000 Fools know what you think. While you're there, you can start your research on any of the other stocks listed above -- or any of the 5,500-plus stocks on CAPS.
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