"The bigger they are, the harder they fall." It's the worst nightmare of every investor in today's market -- buying a rocket stock just before it takes a nosedive.

Now, I readily admit that sometimes, stocks rise for a reason. But sometimes, the rise becomes the reason. No matter how often we caution them not to, investors do have a habit of buying "hot" stocks, and trusting momentum to keep 'em moving upward.

Problem is, if the price goes up too much, even a great company can turn into a lousy investment. Below, I list a few stocks that may have done just that -- stocks that, according to the smart folks at finviz.com, have more than doubled in the last half of '09, and just might be ripe to fall back to earth.


Recent Price

CAPS Rating
(out of 5)

Bucyrus International (NASDAQ:BUCY)



Massey Energy  (NYSE:MEE)



Advanced Micro Devices (NYSE:AMD)



American International Group (NYSE:AIG)



Las Vegas Sands (NYSE:LVS)



Companies are selected by screening for 100% and higher price appreciation over the last six months on finviz.com. Current pricing provided by Yahoo! Finance. CAPS ratings from Motley Fool CAPS.

Last year's last-half market rebound was kind to these stocks, but can they maintain momentum through the rest of the millennium?

A survey of our 145,000 CAPS members suggests the prospects for many of last year's stars look bleak. But there's one stock star they expect to see still shooting 'cross the skies when Dec. 31, 2010, rolls around. Let's find out if they're right, as we examine ...

The bull case for Bucyrus International
A little more than a year ago, CAPS All-Star bradford86 called Bucyrus "the next 10 year play," arguing that companies involved in "drilling and mining more natural resources to fill our growing energy needs" will "capitalize on the push toward mining even more resources." As a key supplier to mining concerns like Vale (NASDAQ:VALE) and BHP Billiton (NYSE:BHP), Bucyrus fits neatly into this niche.

Now, as you may recall, last year wasn't a great one for mining companies; to the contrary, the world economy was going to hell in a handbasket. But as fellow All-Star BSHumphreyII argued: "Contracts with multi-national mining corporations will keep Bucyrus in business until commodities recover and its customers begin to expand operations again. This is as sure a double as you're likely to catch next year ..."

Sure enough, Bucyrus's stock did rocket. More than a double, the stock has actually increased more than 250% over just the last 12 months. And today, post-run-up, CAPS members like dream77 continue to insist that the best is yet to come, proclaiming that Bucyrus remains a "mining play on increased demand."

Judging from Wall Street's predictions, there's no question that demand for Bucyrus's products will increase -- analysts project the company will grow its earnings at 12% per year over the next five years.

Good news?
It might be, except for one thing: the price. While I've got nothing against Bucyrus as a company, I honestly do not believe investors at today's prices stand any chance of profiting alongside Bucyrus tomorrow.

Why not? Right now, Bucyrus trades for some pretty steep multiples to earnings: 16 times trailing results, and nearly 19 times what it's expected to earn this year. For Bucyrus's stock to reward shareholders going forward, I fear it must grow a whole lot faster than 12%. Yet the construction equipment industry as a whole is expected to grow at less than 10%, meaning Bucyrus is already grabbing more than its fair share of that growth; I'm not sure how much more outperformance we can reasonably hope for.

And even that's not the worst part. The worst part is that Bucyrus's reported profits seem to significantly overstate its true cash profitability. Right now, the company turns only a fraction of the amount of its reported profits into free cash flow -- and this has been true for years. Even during the mid-aughts, when the global commodities bubble really hit its peak, Bucyrus struggled to generate free cash flow at anywhere near the level it was reporting GAAP profits. (In fact, the company burned cash in 2006 and 2007.)

Foolish takeaway
Its significant outperformance in 2009 notwithstanding, I'm convinced that Bucyrus is a dud of a stock -- in drag. I'm so convinced, in fact, that I intend to rate the stock an underperformer myself on CAPS.

Think I'm making a mistake? Then wave me off. Click over to Motley Fool CAPS now, and tell me why you think this rocket stock still has some fuel in its tank.

Fool contributor Rich Smith does not own shares of, nor is he short, any company named above. You can find him on CAPS, publicly pontificating under the handle TMFDitty, where he's currently ranked No. 1,034 out of more than 145,000 members. The Fool has a disclosure policy.