Stocks climbing to 10 times their original price are rare breeds -- but they're not impossible to find. Especially when you have Fools for friends.
The market's best stocks include companies that have risen dozens of times in value over the past decade. These aren't penny stocks; they're viable companies with sound business prospects, achieving phenomenal returns every year. Finding just one or two of these monstrously successful firms can help you establish a winning portfolio.
Stalking the monster
To find tomorrow's winners, we'll enlist the more than 120,000 monster-trackers at Motley Fool CAPS. We've compiled a list of the most successful CAPS members, dubbed All-Stars, whose picks have doubled, tripled, or even quadrupled in price. Then we've plucked out some of their recent picks for stocks they find equally promising.
Of course, this is not a list of stocks to buy -- or, for those monster stocks our CAPS All-Stars have already found, to sell. Just consider them starting points for your own further research into extreme buying opportunities.
Smudges on the glass
It's a dark time for Corning. Plummeting consumer demand forced the LCD panel maker to pull its earnings guidance not only for next year, but also for the next quarter. As a result, it's cutting back on R&D spending to conserve funds and remain cash flow-positive throughout the downturn. Yet with $2.6 billion in cash and only $250 million in debt, Corning's balance sheet remains as sharp and clear as one of its screens.
Top-rated CAPS All-Star Alwayzwrong was undoubtedly one of many investors disappointed with Corning's guidance U-turn. But Alwayzwrong also believes that the demand curve will turn up again, to the LCD maker's benefit:
They seemed to be ahead of the curve a few months ago, but they continue to reiterate what they plan to do to cope with the meltdown in LCD sales. [Himax Technologies] warned early (although after [Corning's] warning), and took steps to stem the bleeding. [Corning] did not. ... That said, demand will recover, and I like the company at this valuation. Long term, the company is solid and will certainly be able to manage this economic downturn. Even well-managed companies make mistakes. Looking at their market cap, they sure have paid for them.
A merger, maybe
Locked in a pitched battle over a cancelled merger, specialty chemical maker Huntsman aims to force the deal to go through, regardless of cold-footed Hexion's difficulties in finding financing. So far, the courts have been on its side; if the proposed $28-a-share deal is ultimately consummated, Huntsman's current share price would make for a significant steal. Yet there are still many court battles ahead, and nothing is certain these days.
That doubt might explain why CAPS All-Star srk85 finds Huntsman still dearly priced: "Dividend is unsustainably high, indicating any growth will cost a lot. Much higher PE multiple than other chemical companies without the earnings prospects to account for it."
A chance for scary growth
It takes more than a few All-Star picks and a quick paragraph to make buy or sell decisions, so start your own research on these stocks on Motley Fool CAPS. You can read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made, all from a stock's CAPS page. And while you're there, weigh in with your own thoughts on whether you think these are tomorrow's monster stocks.
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