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 170,000 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 Act. vs. Est.

Avg. Analyst 5-Yr EPS Est.

CAPS Rating

Energy Conversion Devices (Nasdaq: ENER)

$204 million

($0.16) vs. ($0.27)



Luminex (Nasdaq: LMNX)

$821 million

$0.07 vs. $0.5



THQ (Nasdaq: THQI)

$381 million

$0.37 vs. $0.26



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.

An alternative opportunity
With solar PV panel prices continuing to decline, investors in Energy Conversion Devices have gotten burnt during its climb back toward profitability. The second quarter produced revenue of $69 million, below analyst expectations of $74 million. But for the third quarter, the thin-film panel maker predicted even lower sales -- well below what Wall Street had anticipated.

The industry is still groping for a solution. Solyndra received a high-profile visit from President Obama a year ago, highlighting the future of green jobs, but the troubled solar panel maker ended up closing one plant and delaying the expansion of a second one built with tax dollars. Evergreen Solar (Nasdaq: ESLR) also closed a factory because of demand issues. The broader industry faces other concerns too, including Chinese restrictions on polysilicon expansion that could crimp growth at up-and-coming players like GT Solar (Nasdaq: SOLR).

Yet despite the revenue shortfall, margins improved last quarter at ECD, and 92% of the more than 1,250 CAPS members rating the panel maker think it will be able to achieve its goal. Shine a light on your own opinion on the Energy Conversion Devices CAPS page.

Trying times for a testing company
Without a swine-flu tailwind to boost its results, Luminex's profits tumbled 84% year over year, even though its revenue rose 8% to $41 million. Its proprietary biological tests are based on its open-architecture xMAP technology, which enables fast, cost-effective bioassays. Affymax, Becton, and Sequenom (Nasdaq: SQNM) all target the same niche.

However, Luminex offloads some of its risk by seeking out strategic partnerships, as it did this past quarter. The company renewed a long-term agreement with One Lambda, a leading HLA typing and antibody screening player, providing some comfort to the nearly 100 CAPS members, or 88% of the total, who've rated the biological testing outfit to outperform the market. You can test your own theories on its future performance on the Luminex CAPS page.

Man the ramparts
When all your enemies align against you, is that your time to shine? Peter Lynch says it's at least a good place to start your research, and in the video game industry, THQ's looking particularly outmatched.

In this increasingly dog-eat-dog business, Activision Blizzard (Nasdaq: ATVI) has proven to be a formidable rival. Its deep bank account allows Activision to crank out the hits time and again. Yet even its mightiest franchises can get stale, as the end of Guitar Hero has proven. The need to perpetually publish new titles, says CAPS member TheStankometer, is a high hurdle to scale:

Smaller companies like THQI are going to have a very hard time surviving without consistently producing megahits year in and year out. That's a lot to ask. And there are a lot of similarities to another industry I know a lot about: the music industry. Game studios are akin to pop bands. They live and die off of their singles. They need to stay hip and ahead of the curve CONSTANTLY or they will be replaced. Plain and simple. And just like the music industry... piracy is running rampant in the software sector. Even when a studio creates a great game... they still have to worry about half of their fan-base stealing it.

Wanna game the system? Add THQ to the Fool's free portfolio tracker to keep an eye on what direction it's heading, then head over to the THQ CAPS page and give us your opinion whether this gamer stinks.

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!

Becton is a Motley Fool Inside Value selection. Activision Blizzard is a Motley Fool Stock Advisor recommendation. Motley Fool Options has recommended a synthetic long position on Activision Blizzard. The Fool owns shares of Activision Blizzard. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

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