For every stock out there screaming "buy me," others simply give us a nudge and a nod. While all the attention might be focused on their five-star peers, we can sift through Motley Fool CAPS to find four-star stocks giving us the "high sign" that they're approaching greatness.
These opportunities – including familiar names and beaten-down companies -- rank higher than most of the other 5,400 starred companies, and it pays to investigate their potential. For consideration today, I've got this handful of stocks on their way to fame.
Since the 170,000-plus CAPS members have chosen these companies as less obvious sources for tomorrow's great buys, let's see why they might merit your attention.
In the sight of greatness?
Cutting through the fog of regulatory uncertainty helped cigarette maker Lorillard burn up the stock charts. Shares of the maker of Newport, Kent, and Old Gold are up around 40% following the FDA's March decision not to ban menthol cigarettes. Since Newport is the premier menthol brand, it had more to lose from the decision than did Altria
With an annual dividend of $5.20 a share, representing a 4.7% yield, Lorillard is an attractive stock these days, even at these lofty heights. Late last month, it reported strong 14% revenue growth excluding excise taxes in its most recent last quarter, with profit gains of 7% easily surpassing analyst expectations. That could be why all seven analysts rating Lorillard see it outperforming the market indexes, and why 95% of the CAPS members weighing in on the cigarette maker agree.
Let us know on the Lorillard CAPS page why the tobacconist's performance isn't just smoke and mirrors.
A sunny disposition
Cloud computing became an angry thunderhead earlier this year, after F5 Networks
However, F5's results really weren't all that bad to begin with, revealing how badly the market was underestimating its potential. Investors can often make a pretty profit if they're willing to look beyond some of the dark clouds that occasionally blot out the sun. That might be the case with Riverbed now.
It's teaming up with Akamai Technologies
CAPS member EspressoMan88 admits he held off on investing in Riverbed because of concerns about valuation, but the company's market opportunities should put Riverbed shareholders on Cloud 9 before long:
I've missed out on this one with real money due to concerns about its high valuation. It still has a premium valuation, but given its market, impressive technology and growth, I'm betting that those are justified. Should continue to do well over the next few years.
You can follow along by adding Riverbed to the Fool's free portfolio tracker and see whether it continues to float along on good growth.
A solid opportunity
Partisans of solid-state drive (SSD) maker STEC might disagree, but SanDisk's purchase of privately held Pliant will make life even more difficult for the company. STEC has been having a tough year, between inventory issues and natural disasters, leading it to cut back its guidance for the quarter. Pliant already supplies its biggest customer, EMC, with competing SSD's. But if SanDisk's flash memory can find a use in Pliant's products -- a possibility that might not happen until mid-2012 -- the duo could become an even more difficult rival for STEC.
However, that route won't be easy for SanDisk. Some of the leading players are already gunning for its market, forging or strengthening their relationships with storage manufacturers. Seagate Technology and Micron
Some 1,900 CAPS members -- 93% of those rating SanDisk -- have indicated that they think the NAND flash maker will turn out a market-beating performance. You can see whether SanDisk will offer further returns on investment by adding it to your watchlist.
A great opportunity for you
Investor sentiment suggests that these four-star investments still seem to be on their way to five-star greatness. Still, 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 let us hear what you have to say about the great and almost great companies that interest you.