Is Wall Street Wrong About These Stocks?

Wall Street fawns over the companies listed in today's table. So why do our Motley Fool CAPS members disagree? They've tarred these stocks with one- and two-star ratings, showing a lack of faith that the associated companies will outperform the market.

So who has it right? The professional class of analysts sitting in their paneled offices smoking stogies, or a motley crew of community investors pooling their best thoughts for others to share? We think we know who'll come out ahead. How about you?

Source: Motley Fool CAPS.

As much as we love our CAPS community, don't sell these companies short just because they've garnered the lowest ratings. And don't go long just because Wall Street says to. Investing requires closer diligence on your part, so use these ratings as a launching pad for your own research.

Building a future
When an investing legend like John Paulson or George Soros piles into your stock (ignore his politics and focus on his investing acumen), it's going to increase the company's profile, along with its stock price. NovaGold Resources went from relative obscurity and a stock price around $6 a share to wide acclaim and a $15 price tag.

And when that investor pulls out, your company' stock can just as easily fall. NovaGold was trading below $9 a share recently when it was learned Soros had dumped his 9-million-share stake in the junior miner. It's regained some lost ground -- and is still 60% higher, year over year -- but is still joint-owner with Teck Resources (NYSE: TCK) of one of the world's largest undeveloped gold, copper, and silver deposits at its Galore Creek mine.

It doesn't appear that Paulson is exiting his claim to NovaGold, and neither is the CAPS community, where 91% of those rating it believe it will outperform the broad indexes. However, the two-star rating they've given it also suggests they think there are better places for your money. Galore is still in the prefeasibility stages and there are years to go before its riches will be realized.

Tell us on the NovaGold Resources CAPS page whether it's better to be Soros or Paulson when it comes to this junior miner.

Needs more salt
No, Sky-mobi isn't some new airline venture from an emo electronica musician, but rather China's "leading" app store for mobile phones. Can we pile more investor buzzwords into the sentence? It helps explain why the stock rocketed from $5 a share to nearly $23.

But Citron Research gave some oxygen to those breathless descriptions, highlighting how it was Sky-mobi's own paid research that described it as the leading app store (there's no independent verification), and its apps are for the low-end, non-smartphone technology offered by mobile service providers China Mobile (NYSE: CHL), China Unicom (NYSE: CHU), and China Telecom (NYSE: CHA). Definitely not the wave of the future.

The stock tumbled below $6 again, but has been clawing its way back up, and is trading 12% higher even as I write. It could be that a lot of short-sellers piled in after the Citron report, and they are now beginning to get squeezed, since the stock didn't collapse further.

While the one Wall Street firm covering the stock dotes on its pick, nearly 91% of the CAPS All-Stars rating Sky-mobi believe it won't be able to dial up any growth.

How about you? Let us know on the Sky-mobi CAPS page if you think this will be yet another Chinese small-cap stock we'll be disconnecting from.

Going solo
Since the beginning of March, crude oil prices have been falling. The U.S. Oil exchange-traded fund, which tracks the price of West Texas Intermediate delivered to Cushing, Okla., fell from its peak of around $46 a share all the way down to around $35 -- until President Obama decided to release some 30 million barrels over the next 30 days from our Strategic Petroleum Reserve.

That's not a lot. According to Forbes, it's equivalent to the amount needed to feed the world's appetite for oil for less than a day. While oil prices initially fell on the news, they've been making a strong march higher and light sweet crude is approaching $100 a barrel again. U.S. Oil now trades at almost $39 a share. Thanks for the help.

CAPS member secretbonus was equally incredulous at the administration's maneuver, and saw the ETF as ready for a rebound. But highly rated CAPS All-Star saunafool sees other forces at work:

OPEC nations are not getting along very well, recession fears coming back into spotlight, new non-OPEC production coming online, oil prices appear driven by speculation more than market fundamentals. Oil prices set for a tumble in the near term.

Follow oil's trades by adding U.S. Oil to the Fool's free portfolio tracker to have all the news and analysis about its progress aggregated in a single location.

What's wrong with that?
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 tell us which side of the street will be the ultimate winner.