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 by taking advantage of the market's weaknesses. These aren't penny stocks; they're viable companies with sound business prospects that are achieving phenomenal returns. 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've enlisted the help of more than 180,000 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.
Recent Stock Pick
CAPS Rating(out of 5)
Targacept (NAS: TRGT)
Vodafone (NAS: VOD)
Score is how many percentage points that pick is beating the S&P 500.
Of course, this is not a list of stocks to buy -- or, for those monster stocks that our CAPS All-Stars have already found, sell. Just consider them starting points for your own further research of extreme buying opportunities.
Hiding in plain sight
After a series of clinical trials setbacks last year, drug developer Targacept is hoping to regain momentum with its long-term partner AstraZeneca (NYS: AZN) . The pharmaceutical told Targacept it wanted to move forward with its Alzheimer's therapy AZD1446 hopefully avoiding the cloudy results it achieved with a similar compound, AZD3480.
Management at Targacept says there's little reason to worry about its immediate future, that it is well capitalized with notes of more than $240 million available to it and has five compounds in mid- to late-stage trials. It also trades at less than the cash it carries in its bank account. Highly rated CAPS All-Star member BuffettJunior1 believes there's still a lot of value in the stock, too:
This is a classic asset play. The company's intrinsic value is $248 million; I am not taking into account any future earnings here. Compare the $248 million to the current market cap of just under $180 million and you got yourself a bargain! The historic cash burn rate is also very low. Overall, the margin of safety here is very large. You don't need to be the next Warren Buffett to know that you're getting a great deal with this stock.
Let us know in the comments section below what you think of the possibility of it coming back with a winning development, then add Targacept to your watchlist to see whether it hit the big time again.
British telecom giant Vodafone faces different challenges depending on where its far-flung operations are located. In Australia, the carrier is struggling to cut costs and faces a huge bill to renew its mobile spectrum license while in India, a supreme court ruling there revoking all the licenses previously granted in a scandal-ridden auction, many of whom went to small companies, will allow it to grow even bigger.
Here in the U.S., it's wireless joint venture with Verizon (NYS: VZ) continues to put distance between itself and AT&T (NYS: T) . Even though Ma Bell added more than 700,000 new customers as a result of new iPhone activations, Verizon Wireless added 1.2 million more.
The global opportunities, even where there are difficulties, informs the opinion of CAPS member 1oldfatguy who sees even more room to grow:
International play where cell phones are often more prevalent than in the US. Potential growth and steady dividend combine for a win-win.
Tell us in the comments section below if you think it will dial up profits then add it to the Fool's free portfolio tracker.
A chance for scary growth
It takes more than a few All-Star picks and a quick pitch to make buy or sell decisions, so start your own research on these stocks on Motley Fool CAPS and marvel at the range of opinions there.
While you're at it, see the one stock the Motley Fool thinks is changing the face of business. The new special free report highlights theonly tech stock you'll ever needto own, and it's yoursfree for the asking! But only for a limited time, so act now.
At the time thisarticle was published Fool contributorRich Dupreyholds no position in any company mentioned.Click hereto see his holdings and a short bio.Motley Fool newsletter serviceshave recommended buying shares of Vodafone Group. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.