Great stocks with impressive long-term returns can do more than tantalize investors. They might also guide us to the next great stock. For example, information technology and printer giant Hewlett-Packard
Finding the tail on this coat
When you get right down to it, it's hard to find a single sector of the technology marketplace that Hewlett-Packard doesn't touch in some way. The technology behemoth covers a global geography, includes both consumer and business computing segments, and even dabbles a little in software, tape drives, and printers. The company has been on a roll lately, with CEO Mark Hurd running a tight ship that continues to impress Wall Street with its surprisingly strong numbers. With HP's leadership position in many segments for technology products and services, it shouldn't be too hard to find a plethora of other companies benefiting from the quintessential Silicon Valley company.
If we can nail down some companies profiting from the burgeoning ecosystem that Hewlett-Packard is driving, we might find a hidden treasure worthy of investment. With a giant like Hewlett-Packard, investors typically follow the conventional wisdom in looking only for direct suppliers or partners. Obvious choices include major partners such as F5 Networks
Tagging along with CAPS
With CAPS, investors can look through HP's tag list for other companies sporting similar attributes. For instance, Hewlett Packard falls under tags such as "Diversified Computer Systems," "Top Brands 2006," and "California." In addition, the comments that CAPS investors leave regarding rated companies can sometimes lead to similarly attractive investments, even those with little or no direct connection to HP.
These CAPS resources could lead investors to companies such as HP competitor Rackable Systems
Far from being a small company focused on a niche market -- but an attractive investment consideration nonetheless -- is consulting and outsourcing giant and Motley Fool Inside Value selection Accenture
Looking even further out on the tail of HP's coat may land Scientific Games
Of course, plenty of coattail investments have proved to be mere copycats, ultimately flopping for investors. That's why CAPS is best used as a research tool, not a device to pick stocks for you. Rather than take anyone else's recommendation, investors should always perform their own due diligence. But you can't beat the information and resources for the price -- namely, 100% free.
Is there another stock you know about that has HP's wind in its sails? Give your own opinion in Motley Fool CAPS.
Accenture has returned more than 74% since being recommended by the Motley Fool Inside Value service in July 2005. To see which stocks lead analyst Philip Durell has selected to beat the market today, check out a free 30-day trial.
Fool contributor Dave Mock has never worn a coat with tails; he prefers the waiter style. He owns no shares of companies mentioned here. Dave is the author of The Qualcomm Equation. Dell is an Inside Value and a Stock Advisor selection. The Fool's disclosure policy is often imitated but never duplicated.