Analysts Are Completely Wrong About These Stocks

Although there will always be differences of opinion, these are some of the CAPS community's most favored companies. So why does the professional analyst community look down on them?

Below we'll look closer at a handful of companies that CAPS members have bestowed the highest four- and five-star rating upon, meaning you think they have the best chance of outperforming the market. Yet Wall Street still can't muster up enough opinions to agree.

So who's got it right? The professional class of analysts, sitting in their paneled offices smoking stogies, or a motley crew of community investors pooling their best thoughts for others to share. We've got an idea on who we think will come out ahead, how about you?

Source: Motley Fool CAPS.

Now as much as we love our CAPS community, don't invest in these companies just because they've garnered top honors. And don't sell just because Wall Street looks down on them either. Investing requires closer diligence on your part, so use these ratings as a launching pad for your own research.

A ray of hope
For their sheer size and resources, sometimes oil giants like ExxonMobil (NYSE: XOM) and Royal Dutch Shell (NYSE: RDS-A) give up on a project too soon and end up being upstaged by smaller players who've found ways to exploit it.

Back in 2007, Exxon abandoned the Davy Jones ultra-deep prospect in the Gulf of Mexico because of the difficulty in tapping the oil resources there, only to have McMoRan Exploration (NYSE: MMR) come in later to successfully drill the same spot. In the 1990s Shell abandoned the Falkland Islands off Argentina, and according to documents released by WikiLeaks, Exxon said later there's simply not enough oil there to drill profitably.

While some might say that puts an end to it, Spanish oil company Repsol thinks it can still work out as does Desire Petroleum and Rockhopper Exploration, two British outfits.

When it comes to determining whether Repsol remains a profitable investment, CAPS member HunkaChunk thinks the outcome of the country's financial situation ultimately plays a role, but he still sees the oil company rising above it. As do 90% of the more than 220 CAPS members who've rated Repsol to outperform the broad market averages.

You can drill deep into Repsol's own prospects on the Repsol CAPS page and add your thoughts on whether pursuing reserves that the oil giants have given up on is a worthwhile endeavor.

Ride that pony
There shouldn't be any impact to STMicroelectronics if the world's largest nuclear reactor builder Areva follows through on its plan to sell its stake in the chipmaker. French government-owned Areva is trying to raise cash to finance a 12 billion euro investment plan and figures it can get as much as 900 millions euros from its stake in STM. It has previously sold off positions in oil giant Total, energy producer GDF Suez, and others. Since the position will probably go to France's sovereign fund FSI, it's pretty much akin to switching the shares from your left pocket to your right.

So investors might want to focus instead on how big the tablet computer niche is going to be. STM's MEMS gyroscope is found in the iPad and is the one Samsung is using in its new Tab. With Citigroup analysts suggesting there will be some 35 million units sold in 2011 alone (with Apple owning nearly three-quarters of the market), it should translate into to some serious sales for STM.

That could be why 86% of the CAPS members rating the chipmaker think it will post market-beating results. Only you can decide, though, if it is right to add STMicroelectronics to your portfolio, so put it in your watchlist first and have all the Foolish news and analysis aggregated for you in a single place.

Construct an argument for growth
It could be analysts are using their rearview mirrors when assessing Western Refining's prospects. Unlike Tesoro (NYSE: TSO), which focuses more on the western U.S., earlier this year the refiner suffered a setback when east coast demand collapsed causing it to suspend operations at its refinery in Yorktown. It has since begun restructuring itself and expects to raise as much as $500 million by selling a terminal, the proceeds from which it will use to pay down debt.

While analysts think that's too rich, that's just the sort of moves by management that has piqued Ticker007's interest.

WNR is in the early stages of a strategic restructuring that will significantly deleverage its balance sheet, remove restrictive debt covenants, refocus its portfolio to more attractive markets, and unlock shareholder value. It can only get better from here.

With more than 1,100 CAPS members weighing in on the refiner, the community is well ahead of Wall Street here with 95% looking for it to outperform the broad market averages. You can refine your thoughts and let us know your views on the Western Refining CAPS page.

What's wrong with that?
It pays to start your own research on these stocks on Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made, all from a stock's CAPS page.

Sign up today for the completely free service, and tell us which side of the street will be the ultimate winner.