The market may take Wall Street analysts' upgrades seriously -- at least for a day or two -- but here at The Motley Fool, we don't. Instead, we pay much closer attention to the collective knowledge of our 170,000-plus Motley Fool CAPS members. When they upgrade a stock, I like to take a second look to see why.
Below, I've listed three stocks that our CAPS members have upgraded to a lofty four- or five-star rating over the past six months:
|
Company |
Rating 6 Months Ago^ |
Rating Today^ |
Add to My Watchlist |
|---|---|---|---|
| Ameresco (NYSE: AMRC) | ** | ***** | Click here |
| Pacific Biosciences of California (Nasdaq: PACB) | ** | **** | Click here |
| NXP Semiconductors (Nasdaq: NXPI) | ** | ***** | Click here |
^Rating scale runs from one star to five stars.
More than just renewable energy
Whether a company wants to increase energy efficiency or generate renewable energy, Ameresco is there to help. By helping its customers lower energy usage, building renewable energy generation projects, and helping to finance projects to make them budget-neutral, Ameresco provides a service any building owner would love.
The model of energy efficiency is complementary to Motley Fool Rule Breakers pick EnerNOC (Nasdaq: ENOC), which works with companies to respond to demand. Combine the two and you have everything a company needs to make money from being energy efficient.
In the past six months, CAPS members have done a 180 on Ameresco, raising it from a lowly two stars to our top rating of five stars. All-Star RedandBlack has given the company a thumbs-up, saying: "Quality management with a successful track record in the same industry. Large market opportunity and a needed services mean this is a likely long term winner."
I have to say, in my Foolish opinion, I agree.
Changing the world ... eventually
As fellow Fool Karl Thiel recently noted, PacBio's claim of producing a "high-quality human genome in 15 minutes by 2013, for a cost of only around $1,000" may be out the window, but some are looking at this as a minor setback. Never mind that Illumina (Nasdaq: ILMN) creates similar results for a similar price right now, we're changing the world here, eventually.
It isn't often that a transformative technology like nearly real-time DNA sequencing comes along, and even though PacBio's potential is yet to be reached, investors still have faith in the company. CAPS member Simsimmarvin38 thinks the company's research will eventually pay off, saying "Clearly the most powerful technology with a large void to fill in the sequencing space. Granted it will have a slow start as centers have to phase out current technology over time but once momentum picks up this run will be hard to stop."
Coming to a smartphone near you
Another company trying to revolutionize the future is NXP Semiconductors, which is leading the charge in near-field communication. NFC, which can be used for everything from opening car doors to paying for toothpaste, is making its way into smartphones near you at a rapid pace, and NXP could make a killing.
Sony Ericsson recently selected NXP to power NFC solutions for its Google (Nasdaq: GOOG) Android-based phones, and the company is providing solutions for the new Google Wallet. As rumors constantly swirl that NXP will work its way into Apple's (Nasdaq: AAPL) next-generation iPhone, people are getting excited.
Foolish bottom line
A stock upgraded to four or five stars has earned a little more due diligence, if not a spot on My Watchlist. A one- or two-star rating is worth a second look and may signal that it's time to sell. Either way, the collective wisdom of the CAPS community can help steer Fools toward winning investments.
