Growth stocks are the beauties of the stock world, plain and simple. They're exciting, they usually have good stories, and they can make you a lot of money. Dell
But for all their beauty, growth stocks are also the prima donnas of the market. They can be erratic, they don't always live up to their billing, and they tend to attract a shareholder base that's ready and willing to run at the first signs of slowdown. For those reasons, caution is certainly in order when you enter the world of growth investing.
Fortunately, The Motley Fool's CAPS service brings us the collective intelligence of a community of more than 115,000 investors, and it’s a great resource for separating the Jessica Albas from the Frodo Bagginses. Each of the stocks competing for this week's top spot has a market of at least $100 million and grew its net profit by at least 20% over the past year. So let's go ahead and meet our contestants.
If you're trading options or futures based on anything from equity indexes to U.S. weather, there's a good chance that CME Group
Annaly Capital Management
Have you ever wished you could come up with a scheme that would allow you to skim just a little bit of money off of a huge sum and keep it for yourself? Meet Annaly Capital Management
If a standard integrated circuit is a foot soldier, then you could consider a system on a chip (SoC) a Navy SEAL. These juiced-up chips are built to be a one-stop shop when it comes to adding functionality to a new gadget. So what's so cool about Sigma Designs
With $1.4 trillion in assets under management (AUM), BlackRock
As a former Internet darling, Ciena's
The envelope, please ...
Turning to the CAPS community for a verdict, it's clear that BlackRock and Annaly -- which have landed two-star ratings -- just don't make the cut. Ciena carries a slightly better three-star rating, but it just wasn’t enough to be in contention for the top spot. Which leaves us with CME Group and Sigma Designs.
Though CAPS members definitely like CME and its business, its four-star rating just wasn't enough to keep it from getting edged out by Sigma. Sigma has been rated by 1,447 CAPS members, and an impressive 98% of those ratings have been outperform. CAPS member Carbarns is one of those bulls and chimed in earlier this month with:
IPTV is just getting a foothold in the consumer's vocabulary. Watching YouTube and social networking media content will blow this industry wide open and Sigma is poised to exploit it if they play their cards right. Watch to see in their next quarterly report if they don't offer more forward looking financial comments.
Place your votes!
Do you think Sigma Designs has what it takes to be America's next top growth stock? Head over to CAPS and let the rest of the community know what you think.
More CAPS Foolishness:
Sigma Designs is a Motley Fool Hidden Gems Pay Dirt and a Rule Breakers recommendation. Annaly Capital Management is a Motley Fool Income Investor selection. Dell is a Motley Fool Inside Value pick. Try any of our Foolish newsletters today, free for 30 days.
Fool contributor Matt Koppenheffer does not own shares of any of the companies mentioned. The Fool’s disclosure policy would surely win America's Next Top Disclosure Policy, but for some reason there's no such contest.