You don't need the investing acumen of Warren Buffett or the riches of a trust fund baby to achieve financial success.

Since the stock market is your best hope for realizing your dreams, start investing today, by putting away small sums of money every month. Then seek out undervalued small-cap stocks for your greatest returns. I like these stocks because they offer opportunities for growth, while still being mostly overlooked by the big investors.

To find these future giants, we'll screen for stocks with market values less than $3 billion, an earnings surprise of 15% or more in the previous quarter, and forecasts for long-term earnings growth potential of at least 15%. We'll filter our findings through the collective investing wisdom of the 165,000 members in our Motley Fool CAPS community. If the best and brightest CAPS players think these stocks hold potential, we ought to take notice, too.

Here are some of the stocks this simple screen found:


Market Cap

EPS Surprise

Avg. Analyst 5-Year EPS Est.

CAPS Rating
(out of 5)

Deckers Outdoor (Nasdaq: DECK)

$2.1 billion

$0.91 vs. $1.37



RF Micro Devices (Nasdaq: RFMD)

$1.3 billion

$0.11 vs. $0.16



Sigma Designs (Nasdaq: SIGM)

$316 million

$0.23 vs. $0.29



Source: and Motley Fool CAPS.

Of course, this is not a list of stocks to buy -- just a starting point for more research. We need to look more closely at these companies to see whether analysts' faith in them is well-founded. Still, since the CAPS community's helping us out, their favorite selections might be a good place to begin.

No "ugh" in these Uggs
For my money, the Oprah factor is overblown. Sure, her endorsement can put a product on the map -- look at the mad dash her audience made for KFC grilled chicken pieces -- but without something more behind it, the Oprah stamp of approval amounts to little more than any other celebrity endorsement. GM did away with the Pontiac brand despite the Queen of Television's giving away hundreds of the cars to audience members.

Deckers Outdoor gained a lot of attention from Oprah's directing her royal gaze at its Ugg boots, but it was the utility of the boot itself that has kept the footwear maker high-steppin' since. Its stock has soared from below $40 a share a little over a year ago to more than $160 today. Deckers will split its stock 3:1 next month.

Yet for all that, the boot and sandal maker trades at less than 18 times trailing earnings and 15 times next year's profits. Compare that to Nike (NYSE: NKE), which goes for almost 22 times earnings, and it looks like Deckers is still cheap despite its lofty stock price.

CAPS member typeoh says sometimes there's a good reason for a stock to have a high price, and Deckers has one: 

stock near 52 week high, but for good reasons. has blown out earnings reports. no debt. great growth. premium shoe with fashion appeal. all for less than 16x earnings?

Reward vs. risk
While analysts are expecting Apple's (Nasdaq: AAPL) iPhone customer base to hit 100 million users in the next 18 months, mobile-phone-chip maker RF Micro Devices is looking at Nokia's (NYSE: NOK) scaling back sales estimates as a result of intense competition. Nokia accounts for 55% of RF's revenues.

CAPS member llgrout admits there's risk associated with an investment in RF Micro Devices, but believes the potential rewards outweigh that:

This is a value stock and now with a dip, it is a great time to buy. Yes the risk is there. Someone stated that it is undervalued, but I disagree, it appears to be a good solid company, and although I don't expect massive returns, it still has growing left to do. Not without risk, but I think it will at least hit 6, likely 7 by the end of the year.

Considering that RF's CEO says he's comfortable with the profit estimations made by analysts, there doesn't seem to be a reason for negative surprises -- which actually might be a positive development in itself.

In the eye of the beholder
According to the industry watchers at iSuppli, IPTV set-top box shipments are expected to soar 48% this year, which should be good news for Sigma Designs. It's already enjoying a banner year, but concerns about losing exclusivity for AT&T's (NYSE: T) U-verse box processors is weighing on the company.

CAPS All-Star member TMFZahrim says Sigma Designs' newer, lower price is a clear buy signal if there ever were one:

There's a lot of growth and good, steady business going on here, and analysts expect Sigma's earnings to grow by 20% a year over the next five years. Sigma is a longtime Rule Breakers recommendation and a five-star CAPS stock. I thought it looked cheap six months ago, and Sigma has only gotten cheaper. If this isn't an entry point, I frankly don't know what is.

Foolish final thoughts
Stock investing is not brain surgery. Finding good, undervalued companies is not as difficult as the professionals want you to think. You just have to commit to starting now, and do so regularly. Now's the time to begin!