Stocks climbing to 10 times their original price are rare breeds -- but they're not impossible to find. Especially when you have Fools for friends.
The market's best stocks include companies that have risen dozens of times in value by taking advantage of the market's weaknesses. These aren't penny stocks; they're viable companies with sound business prospects that are achieving phenomenal returns. Finding just one or two of these monstrously successful firms can help you establish a winning portfolio.
Stalking the monster
To find tomorrow's winners, we've enlisted the help of the more than 165,000 monster trackers at Motley Fool CAPS. We've compiled a list of the most successful CAPS members, dubbed All-Stars, whose picks have doubled, tripled, or even quadrupled in price. Then we've plucked out some of their recent picks for stocks they find equally promising.
|
Player |
Monster Stock |
CAPS Score^ |
Recent Stock Pick | ||
|---|---|---|---|---|---|
|
94.27 |
Netflix |
377.50 |
Altria (NYSE: MO) |
**** | |
|
98.05 |
Teck Resources |
611.83 |
Cliffs Natural Resources (NYSE: CLF) |
**** | |
|
98.45 |
Bancolombia |
156.16 |
Duke Energy (NYSE: DUK) |
**** |
^How many percentage points the pick is beating the S&P 500 by.
Of course, this is not a list of stocks to buy -- or, for those monster stocks that our CAPS All-Stars have already found, sell. Just consider them starting points for your own further research of extreme buying opportunities.
In search of Bigfoot
Kick back with a nice pinot noir from Chateau St. Michelle while drawing deep on a Marlboro cigarette, and ponder the beauty of Altria's dividend, yielding 6.3% these days. Known more for its cigarettes (and the lawsuits they've spawned) than its wine cellar, Altria found its mojo again last quarter as the Marlboro Man rounded up more market share from Reynolds American (NYSE: RAI) and growth in smokeless tobacco products helped offset declining cigarette volumes.
Philip Morris (NYSE: PM) is enjoying similar growth internationally, without the two steps forward, one step backward impact of volume softness. And without the stigma of lawsuits strapped to it. While that might seem to make it a better bet than Altria, its U.S.-based counterpart is the dominant player in a declining industry, but it's not dying so fast that this is a cigar-butt-type investment. There are years of opportunity still present here, though CAPS member 6cents realizes there are plenty of landmines that could still detonate, including court cases and federal and state government issues.
CAPS member dgoldenz finds Altria offering portfolio ballast:
Safety play to help balance out the portfolio after dumping in a lot of money on growth stocks recently. Everyone else seems pretty confident in this company too and slow/steady growth is never a bad thing.
Burning the midnight oil
Growth is what Cliffs Natural Resources is after. Some analysts might think buying back shares would be a better use of cash to bolster earnings, but the miner is going on a spending spree, snatching up assets to further its position as the largest producer of iron ore in North America. Its purchase of INR Energy will raise its production of coking coal, a key steelmaking ingredient, to 11 million tons by 2012.
Analysts estimate coking coal prices will rise by half this year, as China continues to figure in the equation, but Cliffs' long-term contracts with ArcelorMittal (NYSE: MT) give it a stable repository of its iron ore pellets.
Highly rated CAPS All-Star Beorn10 is looking for investments in this country's infrastructure to boost production:
If we get another stimulus plan or at least talk of one, it will likely revolve around infrastructure, which may be helpful to steel, metalurgic coal and copper producers. If that does not play out, it still has a dividend and positive profits.
Getting static
The smart grid was hailed as the future of energy efficiency, but it may just get swept into the dustbin of history. Turns out we might not be smart enough for the smart grid. Duke Energy is being forced to scale back its deployment of smart meters in Indiana, going from 800,000 over six years to getting just 40,000 in place and seeing how that goes.
PG&E (NYSE: PCG), another pioneering smart grid utility, is facing class action lawsuits over its deployments. It didn't help its case when at least one customer sat through a six-hour blackout only to discover when the lights came back on that his power consumption had tripled during that time. Turns out it was a design flaw that used average data from elsewhere, but it does little to instill confidence in the system.
CAPS member gtucker7848 still finds Duke to be a stabilizing portfolio force, offering what utilities are best known for, a healthy dividend:
Utilities always outperform during high volitility corrections or downturns. Duke Energy is well diversified and is committed to expanding its alternative energy sources. A 5.8% yield doesen't hurt.
A chance for scary growth
It takes more than a few All-Star picks and a quick pitch to make buy or sell decisions, so start your own research on these stocks on Motley Fool CAPS and find other opportunities with monster potential.





