5 Stocks That Just Won't Quit

In my weekly Fool column "Get Ready for the Fall," I run Nasdaq.com's 52-week highs list through the "wisdom of crowds" meter we call Motley Fool CAPS. The result: a list of stocks that have flown so high, investors are starting to get nervous about that whole "gravity" thing. But while many stocks will indeed plunge back to Earth, some seem immune to gravity, steadily riding a rising megatrend to ever-greater heights.

Today, we'll move beyond stocks that have hit 52-week highs, and identify companies now surpassing five solid years of outperformance. Which of these will thrash the market averages for another half-decade? Here are this week's leading contenders:

Companies are selected from the "New 5-Year Highs" list published on MSN Money on Friday. CAPS ratings from Motley Fool CAPS.

The Dow's flirting with 10,000 again, and "caution" seems the word of the day. With muted three-star ratings predominating, Fools aren't predicting any sudden drop-offs this week ... but neither are they confident that the gains of last year will repeat in the next.

If you do want to bet on further gains, our 140,000 CAPS handicappers think your best bets lie in NewMarket and Marvel. Personally, I suspect the Disney (NYSE:DIS) deal is a lock, though. With Marvel trading just a whisker shy of Disney's purchase price, I don't see how the stock can rise much further. But what about NewMarket? Let's take a closer look at that one.

The bull case for NewMarket Corp
CAPS All-Star mansloth introduced us to NewMarket way back in 2006:

This company makes petroleum additives for various purposes. This is a very competive industry that may see some consolidation. NewMarket seems to have a nicely distributed customer base. NewMarket also makes tetraethyl led for led gasoline. The business is family owned and operated and very shareholder-friendly. Non-dilutive and very consistent growth. Management seems to have a tendency to under-promise and over-deliver. For the long term, I like it.

Other members of our superinvestor All-Star class are starting to come around as well. Last month, shaileshnita argued that NewMarket will "improve its revenue as the automotive industry recovers from recession. ... This company is in the growth trajectory ... With no debt it has decent Return on Equity/Assets." And yet another of our All-Star investors, 220330 this time, adds that the firm boasts a "PEG less than one, low analyst coverage, ROE bigger than 20%, current ratio bigger than 2."

And you know, the more I look at NewMarket, the more I like it. This is definitely not the kind of company you'd ordinarily expect to be hitting five-year highs. Its business -- manufacturing chemical additives and lubricants -- has little sex appeal. Only three analysts currently keep track of the stock, giving it a lower profile than rivals like Lubrizol or Chevron (NYSE:CVX).

Basically, I agree with our CAPS members that this is just a good, steady business, and attractively priced despite its place on this list. The company sells for a 15 P/E, which seems appropriate given its projected 15% annualized five-year growth rate. Its strong generation of free cash flow (which comes in just ahead of reported GAAP earnings over the last 12 months) suggests a high quality of earnings, although such a performance has not been consistent in the last few years. But lending further support to the company's current valuation, NewMarket even pays a respectable 1% dividend.

Foolish takeaway
Really, folks, I find little to dislike about NewMarket. Is it the market's most exciting stock? No. NewMarket won't set any speed records for growth, or burn any barns getting there. Rather, NewMarket is a steady performer, selling for a fair to modestly discounted price.

But in a market like this one, where so many companies of debatable quality have been bid up to ridiculous valuations, boring and fairly priced seems to me a nice place to be.

(Disagree? Feel free. Click on over to Motley Fool CAPS and tell us what you think about NewMarket. For that matter, if you've got a more exciting stock idea -- tell us about it, too.)