5-Star Stocks Poised to Pop: Constellation Energy

Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, energy products and services specialist Constellation Energy Group (NYSE: CEG) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Constellation's business and see what CAPS investors are saying about the stock right now.

Constellation facts

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 97% of the 943 members who have rated Constellation believe the stock will outperform the S&P 500 going forward. These bulls include SlowAndSteady123 and paradigms.

Just last week, SlowAndSteady123 touched on Constellation's rather tempting total return potential: "I'm bullish on energy in general over the next 2-3 years. ... This stock will do well for investors -- both in terms of stock appreciation and dividend."

Over the next five years, Constellation is expected to grow its bottom line at an annual pace of 9.9%. That's faster than rivals American Electric (3.9%) and Duke (4.7%), as well as other utility plays like Progress Energy (NYSE: PGN) (4%) and Southern (NYSE: SO) (4.9%). And it's much better than Allegheny's expected 4.5% annual contraction in net income.

CAPS member paradigms expands on the outperform case:

In many respects, [Constellation] is both a great company and a desirable business and, but as important, it's a true value. ...

Sure, [Constellation's] dividend yield ... may not be electric -- its five-year average is a touch better at 3.3% -- but all things considered, it's not bad, either. ...

[Constellation's] virtues are hard to ignore: it's dirt cheap, it's very conservatively run, and its management is doing an increasingly good job of generating more profits.

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