3 Stocks Approaching Greatness
For every stock out there screaming, "buy me," others simply give us a nudge and a nod. While all the attention might be focused on their five-star peers, we can sift through Motley Fool CAPS to find four-star stocks giving us the "high sign" they're approaching greatness.
These opportunities - including familiar names and beaten-down companies -- rank higher than most of the other 5,400 starred companies, and it pays to investigate their potential. For consideration today I've got this handful of stocks on their way to fame.
As the 180,000-plus CAPS members have chosen these companies as less obvious sources for tomorrow's great buys, let's see why they might merit your attention.
In the sight of greatness?
A lot has been made of China's globetrotting expeditions that cherry-pick prime oil and gas assets. CNOOC (NYS: CEO) , one of China's three government-owned oil and gas companies, bought a third of Chesapeake Energy's (NYS: CHK) Eagle Ford shale play, while it and its brethren Sinopec and PetroChina have pursued Africa's oil reserves with tenacity. In short, China is on a mission to buy all the world's oil.
But with the Orient getting all the attention, investors may be missing India advancing its own interests. The subcontinent's government-owned utility Gail India just agreed to buy a 20% stake in one of Carrizo Oil & Gas's own Eagle Ford shale gas assets for $95 million and will invest a total of $300 million in the project over the next five years. This may be the next big surge in oil and gas M&A and could see prices bid up as China and India vie for the largest part of the pie.
As one of the most efficient cash generators and value creators in the oil sector, Carrizo is a lesser known name in the industry, but one which still garners the support of 90% of the CAPS members rating it. Let us know on the Carrizo Oil & Gas CAPS page if this purchase is the start of a major investment push by India in the U.S. and then add Carrizo to your watchlist to see how it plays out.
Something to tap into
Biotech ImmunoGen is finding success licensing its TAP platform technology -- used for attaching tumor-targeting antibodies to agents that kill the cell once they're inside -- to pharmaceuticals and drugmakers like Amgen, Biogen Idec, and Sanofi, while at the same time developing drugs on the side, even though they are still in their early stages.
Rival Seattle Genetics (NAS: SGEN) , however, is gaining traction in the space after the FDA denied ImmunoGen partner Roche an accelerated application for its breast cancer therapy trastuzumab-DM1 last year, but Roche recently announced that T-DM1 met key goals in a midstage study and recently said it made amazing strides in combating breast cancer.
The biotech got a bounce of its own last week when it said it filed with the FDA an investigational new drug application for a wholly owned therapy to treat blood cancers like non-Hodgkin's lymphoma. Although shares are down 30% from the highs, ImmunoGen remains an intriguing investment.
The positive developments are fueling investor interest, and 98% of CAPS All-Stars think it will still beat the Street. Follow the rising tide of all potential outcomes by adding its stock to the Fool's free portfolio tracker.
A networking disconnect
There is some fear the telecom industry will experience a further slowdown this year, and Acme Packet and Broadsoft (NAS: BSFT) have seen their shares gyrating to the conflicting signals the market's giving off.
Verizon is also stalling the rollout of its FiOS network to new areas (though remaining fully committed in places already targeted for installation), which is affecting the whole industry. As a result, Tellabs has been forced to cut costs to the bone, and Cisco decided its best course of action was to focus its energy again on the business it knows best. In short, the number of networking-sector winners have been scarce to say the least.
Still, Tellabs offers investors a chance for international growth, and it hasn't neglected thinking about the future, spending a good portion of its money on R&D. Even though the market appears to be declining for the telecom networking solutions provider, it's continuously looking for new ways to break the mold.
CAPS member scottyjmp3 sees Tellabs' depressed stock as a deal too hard to pass up, particularly as it is otherwise financially sound. That kind of thinking seems to jibe with the broader CAPS community, where 90% of those rating the telecom specialist think it will outperform the market. Indeed, all but one Wall Street analyst following Tellabs has a positive outlook for its future.
You can let us know on the Tellabs CAPS page whether you think it can dial up additional growth while adding the stock to your watchlist to see what the telecom industry's future is like.
A great opportunity for you
Investor sentiment suggests that these four-star investments still seem to be on their way to five-star greatness, but it pays to start your own research on these stocks on Motley Fool CAPS. 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.
Sign up today for the completely free service, and let us hear what you have to say about the great and almost great companies that interest you.
At the time this article was published Fool contributor Rich Duprey owns shares of Cisco Systems, but he holds no other position in any company mentioned. Check out his holdings and a short bio. The Fool owns shares of and has created a bull call spread position on Cisco Systems. Motley Fool newsletter services have recommended buying shares of Cisco Systems, Acme Packet, Chesapeake Energy, and Immunogen. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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