Catching a tailwind when flying can get you to your destination faster. So too with investing: Finding stocks that will earn you profits will be faster if you have the wind of investor sentiment at your back.

In the chart below, you'll find stocks that have gotten a big jump in investor confidence. These are formerly low-rated stocks that have since been awarded the highest ratings by our CAPS community of more than 115,000 members. Why is that important? Our data shows that stocks achieving five-star ratings on Motley Fool CAPS have outperformed the market by 12 percentage points, and newly minted five-star stocks represent your best opportunity to capture those returns.

The five companies listed here have jumped from just one or two stars three months ago to the highest four- and five-star ratings today. With such support at their backs, we'll see if they can withstand the winds of change.


CAPS Rating 3 Months Ago

CAPS Rating Today

Est. EPS Growth Next Year

Indevus Pharmaceuticals (NASDAQ:IDEV)




Lexicon Pharmaceuticals (NASDAQ:LXRX)




RAE Systems (NYSE:RAE)




StoneMor Partners (NASDAQ:STON)




Virtual Radiologic (NASDAQ:VRAD)




Sources: CAPS and Yahoo! Finance. NM = not meaningful.

But just because these stocks are purring is no reason to jump into them blindly. Catching a tiger by the tail can end up leaving you scratched and bleeding. That's why we recommend you use this list as a launch pad for your own research and analysis.

Fleet of foot
A blockbuster drug is always nice to have, as it can present a strong, steady flow of revenue for years to come. But CAPS member fojaha thinks the passel of drugs that Indevus Pharmaceuticals has makes up for the lack of any one big seller:

Indevus was bid down as a result of FDA conditions for new drug nebido. Traders have ignored the fact that the company has other products on the market. Sanctura &sanctura xr,Vantas,supprelin, and delastestryl. Earned 60mi in revenue & royaltys this yr. Alergon, maker of Botex is Indevus partner for marketing sanctura, cant get much better. Seven more drugs in development. Valstar,a bladder cancer drug is most advanced. No huge sellers, but combined it makes a pretty good revenue stream.

Another pharmaceutical looking to make a splash is Lexicon Pharmaceuticals, which has a drug on fast-track status to deal with carcinoid syndrome, which involves an intestinal tumor that secretes an excess amount of hormones. It also recently announced positive phase 1 results for a drug to treat irritable bowel syndrome, but as Novartis (NYSE:NVS) could attest, that's not always a prescription for success. Although it doesn't have as many products as Indevus, CAPS member kmontem thinks Lexicon's business has promise:  

After reading through the SEC filings, I believe this company has a potentially profitable business but a few hurdles to go through before they take off. Even though they have a fast track drug, they have liscensed the right to that drug and two of their other star drugs to Symphony Icon (which they have the right to purchase through 2011). If they do not exercise that right (because the drugs don't work, don't have the cash, etc.) they could lose all revenue from those drugs should they prove profitable. I look forward to seeing if they take off.

The promise of 24-hour access to radiologic interpretations is the idea behind Virtual Radiologic and rival NightHawk Radiology (NASDAQ:NHWK). CAPS member Knifecatcher1 finds it an excellent concept:

An innovative solution to the shortage of radiologists in this country. [Virtual Radiologic] provides radiology interpretation services to U.S. health-care providers 24 hours a day. Radiologists under contract provide reads during set hours in their own homes. It eliminates the expense of paying an on site radiologist at night, something smaller facilities cannot afford. This is another play on medical care cost cutting by leveraging existing technology. Recession resistant. Long term winner.

Top-flight stocks
There's a saying that the race doesn't always go to the swift nor the fight to the strong, but that's the way to bet. We might consider that in investing, too. Strong companies rising quickly in the estimation of investors just might be the place to begin looking for winning bets. Therefore, 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.  

Head over to CAPS today and share your thoughts with other investors on whether you think these stocks are on the move. It's free.

NightHawk Radiology is a Motley Fool Hidden Gems Pay Dirt recommendation. Try any of our Foolish newsletters today, free for 30 days, for inside tips on how to take advantage of the market's misery.

Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.