Drink In These 5 Top Stocks

Whether it's the corporate lunchroom, your cubicle, or the local watering hole after work, there are regular places we gather to discuss news, sports, or -- if you're like us -- stocks. Here at Motley Fool CAPS, we gather around the virtual water cooler daily to rate stocks and delve into their merits as investments.

Our 145,000-strong CAPS community -- where members give the thumbs-up or thumbs-down to some 5,300 stocks -- seeks businesses it thinks will outperform the market. Below we'll take a look at some of the most popular and talked-about stocks in the CAPS universe, and examine whether you think they'll continue their winning ways.

A tall drink of water
The tsunami that wiped out financial markets globally last year also washed away the growth prospects of many companies that serviced them. In particular, consulting companies seemed to feel the sand shift beneath their feet more quickly than others did.

Industry best practices advisor Corporate Executive Board (NASDAQ:EXBD) counted on investment banking, insurance, and mortgage brokers for more than a quarter of its business in 2007. When the industry imploded, some of its clients simply didn't exist anymore. Contract values, which CEB viewed as a good proxy for future growth, disappeared -- and its stock price crumbled. Growth rates did a 180-degree turn, from a 28% increase as late as 2006 to a 28% decrease just this past quarter, with the potential for further declines throughout this year.

Yet since the dark days of early 2009, the stock market has staged a phenomenal recovery, bringing these same consulting companies along for the ride. After bottoming out at just less than $13 a share, Corporate Executive Board stock has risen more than 80%. Not bad for a company that doesn't see any growth in its business anytime soon.

Other industries relying on the financial services sector have been equally blessed. IT outsourcing specialist Infosys Technologies derived a third of its revenue from financial services in 2009, but shares were up more than 150% since the lows of last March. Rival Indian outsourcer Wipro (NYSE:WIT) rose more than 400% since then.

Infosys has undoubtedly benefited from the vast sums of money funneled to the banks and brokers by the U.S. government while struggling to prop up a tottering system. Indeed, Infosys was able to report this quarter that its top 10 clients increased sales by more than 12%, twice the rate that the overall customer list produced. Still, there remain strong headwinds buffeting the IT sector, including a shortage of people and the still-fragile state of monetary affairs. A double-dip recession could plunge these businesses back to the brink.

Investors remain enamored of their potential, though. CAPS member MagicUKW finds Infosys significantly undervalued.

The value of this company is way higher than the quotes are right now. The concept is outstanding and it is going to grow more and more.

Similarly, back in October, InvestingMonk thought Infosys might run into some near-term hurdles that could complicate its progression, but over the long haul it was an excellent buy.

Maybe not excellent in the short term, but this should outperform in a number of years. Superb balance sheet, industry leader, growing market. The price is a bit high, but I think it's reasonable for this company.

Why not let us know on the Infosys Technologies CAPS page whether this tech leader has what it takes?

Gather 'round
With so many good opinions about today's top companies, why not grab a pointy paper cup from the dispenser and join us at the Motley Fool CAPS water cooler? Your input can help guide other investors to stocks with bright prospects. 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 let us hear what you have to say about the great and almost-great companies that interest you.