Investors are always hunting for the next big stock -- the dream stock whose price increases several times over when the market finally discovers it. It's easy to look back and see what the 10 best stocks of the past decade were. But I'm more interested in the tools that can not only help me find new stock ideas, but also have the resources necessary to evaluate tomorrow's greatest companies.

One tool offers a variety of resources to help find tomorrow's leaders: Motley Fool CAPS.

We'll use CAPS to screen for top Internet stocks and get the story behind them. CAPS' nifty screener will help us find stocks with:

  • A market cap of at least $100 million.
  • A three-year revenue growth rate of at least 15%.
  • A price-to-earnings ratio of less than 25.
  • A gross margin of at least 50%.

Then we'll tap the collective intelligence of our 115,000-plus CAPS members to see whether these companies present real opportunities -- or whether the numbers fail to tell the true story.

Opinions with the numbers
Here's a sampling from the list of stocks our screen pulled up today.


Revenue Growth Rate, Past 3 Years

Gross Margin

CAPS Rating (Out of 5)








j2 Global Communications (NASDAQ:JCOM)




Shanda Interactive (NASDAQ:SNDA)




Data and star rankings from CAPS. All data as of Aug. 10.

Online gaming company GigaMedia is stacking its chips with its popular Everest Poker site; its revenue grew 56% year over year. And with its sponsorship of the 2008 World Series of Poker, the company will get immense exposure, what with its logo put on every tournament table and more than 300 million households around the world watching on ESPN. With the company's consistently high gross margins and a share price that is down nearly 30% over the past few months, some see GigaMedia as set to take off. At least 98% of the 1,827 CAPS members rating GigaMedia see it that way, because they've picked it to outperform the market.
With the Chinese online gaming market growing 60% in 2007, NetEase and other popular online game companies like Shanda are adding subscribers by the millions. NetEase's high profitability has it consistently earning net margins above 50%, but highly profitable operations bring increased competition. It also often means more taxes, which caused NetEase to report lower earnings per share for the first quarter, even though sales grew 18% year over year. But based on a bright future, including more new games being unleashed soon, more than 97% of the 882 CAPS members rating NetEase expect it to outperform the market.

j2 Global
Internet fax and messaging service provider j2 Global has a long list of patents, which it's increasingly using to develop a moat against possible competitors. Like technology licensors InterDigital (NASDAQ:IDCC) and Qualcomm (NASDAQ:QCOM), j2 Global also plans to capitalize on its intellectual property by licensing its portfolio. And while it continued its consistent revenue growth in 2007 -- at 22% for the year -- its susceptibility to economic cycles meant growth stalled late in the year. But many CAPS members -- including this Fool -- see long-term potential in j2's unique solutions. More than 95% of the 348 members rating j2 Global are bullish.                           

Powered by 6 million users and fast growth in its multiplayer fantasy games, Shanda posted a 47% gain in revenue for the first quarter. While earnings per diluted American depositary share (ADS) fell, this was only because the company logged a big one-time gain when it sold its stake in SINA (NASDAQ:SINA) last year. Because Shanda has more than $460 million in cash and a projected growth rate of 20%, some see it as a growth stock to buy -- just not everyone. But a strong majority of nearly 97% of the 799 CAPS members rating Shanda are in the bull category, believing the company will outperform the S&P.

Let 115,000 investors be the judge
The collective wisdom of a huge pool of investors can help give context to a page of numbers developed through a stock screen. But even with an entire community of qualified opinions acting as the judge, individual investors are still the jury and should perform their own due diligence.

Want to run your favorite parameters through the CAPS screener? It's totally free, including the extensive investor knowledge base of ratings, commentary, and blogs. You can even give your own opinion -- both good and bad -- on any company you wish in Motley Fool CAPS.

Motley Fool Global Gains is another Foolish resource to help you find promising investments, like GigaMedia, beyond our borders. Check out all the stocks recommended in the international investing service free for 30 days.

Fool contributor Dave Mock dreams of stocks and sugarplum fairies, but not together. He owns shares of Qualcomm and is the author of The Qualcomm Equation. j2 Global is a Motley Fool Hidden Gems Pay Dirt recommendation and GigaMedia is a Global Gains selection. Shanda,, and GigaMedia are Rule Breakers selections. SINA and InterDigital are Stock Advisor recommendations. The Fool's disclosure policy screens the good, the bad, and the ugly.