Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, generic-drug maker Hi-Tech Pharmacal (Nasdaq: HITK) has earned a coveted five-star ranking.

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

Hi-Tech facts

Headquarters (founded)

Amityville, N.Y. (1982)

Market Cap

$384.5 million



Trailing-12-Month Revenue

$190.8 million


Chairman/CEO David Seltzer (since 1998)
CFO William Peters (since 2004)

Return on Equity (average, past 3 years)



$59 million / $708,000


Mylan (Nasdaq: MYL)

Watson Pharmaceuticals (NYSE: WPI)

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

On CAPS, 94% of the 205 members who have rated Hi-Tech believe the stock will outperform the S&P 500 going forward. These bulls include bjm1625 and riciulius.

A few months ago, bjm1625 touched on the tailwinds working in Hi-Tech's favor:

With rising cost of health care and prescription drugs, generic-drug manufacturers stand to gain the most. Also has drugs in its pipeline to fight the rapidly growing Diabetes epidemic. Solid company with little debt.

Currently, Hi-Tech even sports a cheapish P/E of 9.6. That represents a clear discount to generic rivals Mylan (34) and Watson (54), as well as big pharma foes such as Pfizer (NYSE: PFE) (19).

CAPS member riciulius elaborates on the Hi-Tech bull case:

Low PE, tons of cash, tiny debt. But that is not why this is going to be a giant killer. The real reason I see this stock outperforming the market is that they largely operate in the generic prescription market.

Over the next few years several factors will fuel fast growth in this market. First, a vast majority of the drug patents on very big drugs will be expiring over the next couple years. This will mean that the total market share enjoyed by the generic drug makers will go way up. I also think when these patents actually start to expire, the markets will gravitate strongly toward the generic makers.

With the cash to invest in expanding the array of drugs they offer as patents allow it, I can see the market reacting very favorably to this stock over the next two years.

What do you think about Hi-Tech, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Pfizer. Try any of our Foolish newsletter services free for 30 days.

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