The Oracle of Omaha, Warren Buffett, turned an initial bankroll of $10,000 into a multibillion-dollar conglomerate. Shelby Davis began with $50,000, and he amassed a $900 million fortune. These inspiring stories give us all hope that we'll be able to achieve our own financial dreams. But what if you don't have $50,000, or $10,000, or even $5,000 to get started?

Fear not, Fool -- you aren't doomed to penury. You don't need to be a trust-fund baby to start securing your financial future. Just follow these four simple steps:

Why small caps?
Because they offer the greatest potential for market-beating returns. Institutions tend to ignore these tiny stocks, and analysts don't cover them. By the time anyone realizes they're there, they've already grown and appreciated in price.

To find some of these, we'll screen for stocks with:

  • Market values less than $3 billion, to qualify as a small cap (but no micro caps).
  • An earnings surprise of 20% or more in the latest quarter.
  • Long-term earnings growth potential of at least 20%.

We'll filter our findings through the collective investing wisdom of the more than 145,000 professional and novice investors in our Motley Fool CAPS community. If the best and brightest CAPS players think these stocks hold potential, then we ought to take notice, too.

Here are some of the stocks this simple screen found:


Market Cap

EPS Surprise

Median Analyst 5-Year EPS Estimate

CAPS Rating
(out of 5)

China Green Agriculture (NYSE:CGA)

$355.6 million




Fuel Systems Solutions (NASDAQ:FSYS)

$739.5 million




Graham (NYSE:GHM)

$205.6 million





$170.3 million





$334.9 million




Source: Yahoo!

Of course, this is not a list of stocks to buy. This is a starting point for more research. We need to look more closely at these companies to see if analysts' faith in them is well-founded, but we've got the CAPS community helping us here, and starting with the favorites there would be a good place to begin.

An alternative opportunity
It raised more than a few eyebrows when alternative fuel components maker Fuel Systems Solutions blew past analysts' earnings expectations, even though it was the third straight time it had confounded the pros.

Demand for alternative fuel vehicles continues to power the company, with revenue increasing 10% from a year ago. That generated $15.5 million in profits, a 30% jump from last year. While hybrid vehicles are gaining momentum here in the U.S., with Ford (NYSE:F) setting sales records with its Ford Fusion Hybrid and fueling stations run by Clean Energy Fuels (NASDAQ:CLNE) spreading far and wide, the fortunes of Fuel Systems Solutions will rise and fall with developments in Europe, because more than 80% of its revenue comes from non-U.S. operations.

While there may be more hurdles ahead, CAPS member FreeMortal thinks its strong financial position makes this company a winner:

Lots of cash and minimal debt should keep this company going, even through more unexpected troubles ahead. Margins and ROE are excellent compared to its peers. Looks like a grower.

It would seem the CAPS community agrees, with 84% of the members rating Fuel Systems believing it will outperform the market. Head over to the Fuel Systems Solutions CAPS page and give your opinion, too.

Foolish final thoughts
Academics will tell you that individual investors have little chance of beating the stock market. They say the Warren Buffetts, Shelby Davises, and Peter Lynches are the exceptions to the rule. We at The Motley Fool don't agree. Stock investing is not brain surgery. Finding good, undervalued companies is not as difficult as the professionals want you to think.

It is possible to make a more comfortable retirement for yourself, even if you have little money to start with or are starting late in life. It is possible to turn $100 into $1 million. You just have to commit: Do it now, and do it regularly. No amount is too small. Let's get started. There's no time to lose.

China Green Agriculture is a Motley Fool Global Gains choice. Try any of our Foolish newsletter services free for 30 days.

Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings. The Motley Fool has a disclosure policy.