Sadly, there's no such thing as an ultimate buy signal when it comes to investing in stocks. Identifying companies with the wind at their back takes time, patience, and a good dose of due diligence.

There is, however, an easy way to increase your odds of finding the stocks that will beat the market. At Motley Fool CAPS, the Fool's investing community of more than 120,000 members, we've found that five-star stocks, as a group, substantially outperform the broader market -- to the tune of 12 percentage points on an annualized basis from November 2006 to July 2008.

In order to fully capture the upside potential of those five-star stocks, it makes sense to identify them just as soon as they achieve five-star status. Fortunately, our CAPS screener now makes it possible to do this. Below, for example, is a list of companies that have been upgraded to five-star status from four stars just yesterday. These stock ideas are only a starting point, of course. Be sure to join us on CAPS to dig in even further.


All-Stars Saying Outperform

Targa Resources Partners LP (NASDAQ:NGLS)

139 of 145

Ambassadors Group, Inc. (NASDAQ:EPAX)

414 of 431

Balchem Corp (NASDAQ:BCPC)

161 of 165

ProShares UltraShort Lehman 20+Year Treasury (NYSE:TBT)

248 of 257

Kraft Foods, Inc. (NYSE:KFT)

1622 of 1733

iShares MSCI EAFE Index Fund (ETF) (NYSE:EFA)

507 of 525

Data from Motley Fool CAPS, Dec. 15, 2008.

Come join us on CAPS, absolutely free, to learn more about these and countless other interesting stock ideas.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.