Now that talk of a growth stock rally has spread to the pages of The Wall Street Journal, it's time to check in on some of the funds that ought to be benefiting from the shift. This week, our subject is T. Rowe Price New Horizons.

Manager John Laporte, who uses a quantitative formula to pick the best small-cap growth stocks, has a history of beating the market. But not this year. Morningstar reports that New Horizons is lagging the S&P 500 by a quarter-point so far in 2007.

As if that matters. Volatility is to be expected when investing in high-growth small-cap stocks. Legendary stock picker Thomas Rowe Price, who started New Horizons in the early '60s managed it for more than a decade, suffered a 29% decline in 1962 and posted an 87% gain in 1967.

Notice that Price was rewarded for sticking with his strategy over time. Laporte will be, too. He and all-star stock pickers like him know that:

How we do it
Of course, not all growth stocks will do. Our weekly hunt is for the next great multibagger. But unlike David Gardner and his team at Motley Fool Rule Breakers, who scour everything from financial statements to trade magazines to clinical reports in their research, we're going to rely on our Motley Fool CAPS investor intelligence database.

Specifically, we're looking for stocks that have earned a five-star rating in CAPS and which are expected to grow their earnings by at least 20% annually over the next five years. Five-star stocks are those that the community, on the whole, believes will outperform the S&P 500.

Let's have the list
Now, with that preamble behind us, here are five more top growth stocks:


No. of CAPS Ratings

Bullish CAPS Ratings

5-Year Growth Est.

Color Kinetics (NASDAQ:CLRK)




Mindray Medical (NYSE:MR)




WNS Holdings (NYSE:WNS)




Warner Chilcott (NASDAQ:WCRX)




Nuance Communications (NASDAQ:NUAN)




Source: Motley Fool CAPS, Yahoo! Finance

Bear in mind that this isn't a list of recommendations. Instead, I offer these stocks as candidates for further research. But of these five it's LED light maker Color Kinetics that interests me most.

LEDs, or light emitting diodes, are far more energy efficient than traditional light bulbs, and could save billions in power consumption. For more on this thesis, I'll turn to fellow Fool and CAPS All-Star Rich Duprey, known here as TMFCop:

Color Kinetics is one of the leaders in the solid-state lighting industry and holds competition-thwarting patents for the use of its LED technology. While patents can be short-circuited by new technology, LED lighting IS the new technology. It is the next step beyond incandescent bulbs.

Intrigued? Do your own due diligence and then check in with thousands of other investors at CAPS. And if you'd like, add your own commentary. You'll be helping your fellow Fools and testing your ideas at the same time. Click here to get started; the service is 100% free.

See you back here next week for five more top growth stocks.

Nuance Communications is a Motley Fool Hidden Gems recommendation. Mindray Medical is a Rule Breakers choice.

Fool contributor Tim Beyers, who is ranked 6,116 out of more than 28,700 ranked players in CAPS, is a sucker for growth stocks and a regular contributor to Rule Breakers. Tim didn't own shares in any of the companies mentioned in this article at the time of publication. Tim's portfolio holdings can be found at his Fool profile. His thoughts on growth stocks, Foolishness, and investing in general may be found in his blog. The Motley Fool's disclosure policy is your portfolio's competitive advantage.