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 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
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
Computer networking king Cisco has long held dominion over the vast enterprise routing and switching market, but lately its rule is being attacked. Even Cisco's CEO admits the "backbone of the Internet" has developed a case of scoliosis. While the court jesters debate whether John Chambers should abdicate, the barbarians at the gate include a trio of princes: F5 Networks
In particular, Brocade is jousting with Cisco through contracts with Dell, IBM
With 95% of the nearly 800 CAPS members who have rated Brocade marking it to outperform the broad market averages, it appears they agree that the storage and networking specialist is no pretender to the throne. Head over to the Brocade Communications CAPS page and let us know if you'll be joining in on the castle revolt.
Cheap by any measure?
You have to be a real contrarian to see homebuilders Hovnanian, Toll Brothers
As housing prices continue to fall, negative equity rises, and the amount of inventory on the market grows. At some point, homeowners realize it just doesn't make financial sense to keep pouring money into an investment they likely won't ever recover. But there are more than a few investors and analysts who think we've just about hit the nadir of this decline, and if that happens, CAPS member kavaron thinks Hovnanian will recover as well because of the quality and affordability of its product: "Housing in the US is bottoming and this one builds some of the finest cheap homes."
That's a minority viewpoint right now, as less than 45% of the CAPS members rating Hovnanian see it outperforming the indexes. You can follow along by adding it to your watchlist.
Sure social networking is hot, and China's demographics make it tempting to think that Renren can capture the same growth trajectory that Facebook has. And while the valuations being assigned to these companies are ridiculously large -- Facebook at $50 billion, Renren at $7 billion, and the upcoming LinkedIn IPO at around $3 billion -- it's starting to look like maybe the market is wising up to the social-networking bubble. Since Renren went off at around 78 times sales, that's nosebleed territory that will require stanching.
Facebook has been successful because it allows for free expression of ideas, online advertising, and gaming. Renren's got the latter two, but for a country that censors anything approaching free thinking, it's going to be seriously lacking in that key area. If all you can do is spout the government line, why bother?
Speculation, therefore, could drive Renren higher and leave my downthumb throbbing. In the short run, however, while Renren seemed to have a successful IPO with a decent upside after the release, it has been floundering as real investors wonder about several very serious and underriding issues.
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 marvel at the range of opinions there.
Juniper Networks and MercadoLibre are Motley Fool Big Short short-sale recommendations. MercadoLibre and Universal Display are Motley Fool Rule Breakers recommendations. The Fool has created a bull call spread position on Cisco Systems. Alpha Newsletter Account, LLC has opened a short position on Juniper Networks. The Fool owns shares of International Business Machines. Alpha Newsletter Account, LLC 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.