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 more than 170,000 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.
Recent Stock Pick
|TDRH||99.94||American Home Mortgage||101.35||
Score is how many percentage points that pick is beating the S&P 500.
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
Investors have had an all-too-familiar sinking feeling with Amylin Pharmaceuticals' shares getting crushed lately. After the FDA rejected its diabetes drug Bydureon, saying it needed more testing, it said earlier this month results from new clinical trials came up short. Amylin and partners Eli Lilly and Alkermes
And after the experience other obesity-drug makers have had before the FDA, you probably shouldn't count on Amylin's combination pramlintide/metreleptin treatment going anywhere fast. It put the drug on hold until more testing can be done.
Yet even with the drumbeat of negativity, CAPS members remain hopeful, and 90% of the All-Stars rating the biopharmaceutical see it still being able to beat the broad market averages. Head over to the Amylin Pharmaceuticals CAPS page and let us know if there are any fat profits to be made here.
Cheap by any measure
Cisco's shares are cheap. Very cheap. It trades at a very discounted enterprise value-to-free cash flow ratio of 9, but has grown free cash flow over the last year at a 20% clip. At 13 times earnings and less than 10 times forward estimates, the networking systems specialist only needs to prove that its cash-generating capabilities can improve slightly to underscore how much of a value it is right now. Add in $40 billion in cash with only $12 billion in debt and you've got some serious muscle that will be able to challenge Juniper Networks
CAPS member oliversk thinks that while Cisco's shares may not have bottomed, for long-term investors, it's too hard to try to pick the precise inflection point:
Dividend, low PE, 52-week low. Maybe a time to buy? Or hope that you can grab some at $16, but for me it's not worth the wait. I'll hold this for a few years and hope to sell for 27 or more as happened numerous times before over the last 10 years.
You can see how expensive Cisco becomes by adding it to the Fool's free portfolio tracker.
A bright idea
Demand-response aggregators like EnerNOC and Comverge assist consumers and businesses in remotely reducing their electrical consumption during peak demand periods. In return, utilities and grid operators pay them for reducing the overall demand on the grid.
The smart grid can be a smart play, but EnerNOC was awfully dumb to get caught up in allegations of double booking energy savings. PJM, the largest grid operator, all but accused it of "engaging in market manipulation." PJM didn't name names, but EnerNOC accounts for 35% of its demand-response market. Fortunately, FERC has since said there is no "there" there.
Over 96% of the CAPS All-Stars rating EnerNOC believe it will beat the Street going forward, but WatchfulEye1776 thinks the company itself has given enough reason to approach it with caution:
Their flagship product is becoming commodotized and they have guided that their diversification products will be a much smaller percentage of revnue going forward.
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.
Juniper Networks is a Motley Fool Big Short short-sale recommendation. EnerNOC is a Motley Fool Rule Breakers pick. The Fool has written calls on Cisco Systems. Motley Fool Alpha has opened a short position on Juniper Networks. The Fool owns shares of EnerNOC. Motley Fool Alpha owns shares of Cisco Systems. 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.