Investments that have been successful over the long term almost assuredly share at least one thing in common -- growth. You'll be able to find very few companies that have been unable to increase their earnings and yet still have produced good returns for shareholders.

Think about it this way: Dividends aside, investors reap their gains when a company's stock price goes up. The stock price is typically driven by two levers: earnings, and the multiple that investors are willing to pay for those earnings. Since earnings multiples tend to fluctuate within a certain range, long-term investors should have a keen focus on the company's ability to increase earnings.

Does it seem too simple? Maybe keeping it simple is a good plan sometimes. After all, as Third Avenue's Marty Whitman has put it:

Based on my own personal experience -- both as an investor in recent years and an expert witness in years past -- rarely do more than three or four variables really count. Everything else is noise.

With that in mind, I've kept it simple and dug up five stocks that analysts expect will notch long-term earnings growth of 10% or better. I've also pulled up the CAPS rating for each stock to show what the 135,000-member Motley Fool's CAPS community thinks of the company's prospects.


Expected Growth

Forward P/E

CAPS rating
(out of 5)

Atwood Oceanics (NYSE:ATW)











Cliffs Natural Resources




Hewlett-Packard (NYSE:HPQ)




Source: Capital IQ, a division of Standard & Poor's, Yahoo! Finance, and CAPS. P/E = price-to-earnings ratio.

Wall Street analysts aren't known for being supernatural in their forecasting skills, so not all of these estimates may pan out. However, this list may be a good place to dig in for further research. I'll even get you started with some thoughts on a couple of these stocks.

Cool to the touch
If you're looking for cutting-edge, then VMware might be right up your alley. An EMC (NYSE:EMC) subsidiary, VMware is a pioneer in the area of virtualization. Just like kindergarten, virtualization is all about the benefits of sharing. Rather than splitting time with the Play-Doh, though, virtualization allows the sharing of computing resources.

There are quite a number of CAPS members who are excited about both virtualization and VMware, but there are enough members that aren't so hot on the stock that it has been stuck with a mediocre three-star rating. Many of the VMware bears seem to think that there could be more hype than substance to the company, and that its stock price has gotten a bit ahead of itself.

Bringing the heat
But what about high growth and a high rating from the CAPS community? For that, we can turn to Atwood Oceanics.

Similar to the massive Transocean (NYSE:RIG), Atwood owns and operates offshore drilling equipment that it throws into gear for customers like BHP Billiton and Chevron (NYSE:CVX). Of course, both in fleet size and in market cap, Atwood is far smaller than Transocean -- though some might say that gives it more room for growth.

On CAPS, the stock carries a perfect five-star rating, with nearly 1,900 outperform ratings. Let's take a look at why Gtrinvestor -- one of CAPS top-rated members -- recently gave Atwood a thumbs-up:

Oil may be going down a little short term, but long long term, you have got to be kidding yourself if you think oil is going down. [Atwood] participates in the limited competition world of deep water drilling. There are high barriers to entry (very expensive rigs) and contracts tend to be longer term than jack-ups.

But what do you think?
Which of these stocks do you think has what it takes to post solid growth in this economy? Or have analysts been too optimistic? Currently, more than 135,000 members of the free CAPS community are sharing their opinions on thousands of stocks. Head over to CAPS and let the community know what you think of VMware, Atwood, or any of the other stocks listed above.

Related CAPS Foolishness:

Ctrip is a Motley Fool Hidden Gems selection. VMware is a Rule Breakers recommendation. Atwood Oceanics is a Stock Advisor selection. Why these stocks and why these newsletters? Take a free 30-day trial of any of them to find out. Cemex is a Stock Advisor and a Global Gains pick. Suntech Power is a Rule Breakers selection. The Fool owns shares of Cemex. 

Fool contributor Matt Koppenheffer does not own shares of any of the companies mentioned. You can check out the stocks he's keeping an eye on by visiting his CAPS page, or you can connect with him on Twitter @KoppTheFool. The Fool's disclosure policy likes to keep it simple -- make your disclosure properly and you don't get put in the dreaded triangle choke.