stopwatch  ©  Steve Allen/Brand X/Getty Images

Extra9/25/2007 6:00 PM ET

The best stocks right now

Bolder-than-expected action from the Fed has some investors returning to small and midsize companies. Here are 10 stocks highly regarded by the MSN Money CAPS investing community.  

By The Motley Fool

One would think that in times of market uncertainty, investors would flock to large-cap stocks such as Procter & Gamble (PG, news, msgs) and Coca-Cola (KO, news, msgs), which are traditionally less volatile than their small-cap brethren.

But according to more than 65,000 investors participating in the MSN Money CAPS community, small caps are still worth your investing dollars.

In fact, of this month's top-rated stocks on CAPS, only two companies, Manulife Financial (MFC, news, msgs) and CGG Veritas (CGV, news, msgs), boast a market cap of more than $5 billion.

Perhaps one of the reasons for the positive sentiment around small companies is last week's aggressive move by Federal Reserve policymakers to stop the spreading credit crunch from sinking the nation's economy with a half-percentage-point cut in interest rates.

The move lowers the cost of borrowing and fuels growth for tinier companies.

Furthermore, with oil trading above $80 a barrel, petite oil- and gas-services companies are attracting investor attention.

This month's top stock, for instance, TGC Industries (TGE, news, msgs), conducts seismic surveys of oil and natural-gas wells, which helps oil conglomerates understand their wells and maximize extraction value.

Here's this month's list:

The top 10
CompanyIndustryMarket capitalization

TGC Industries

Oil-field equipment and services

$164 million

Rofin-Sinar Technologies

Scientific and technical instruments

$1 billion


Natural-gas utilities

$4.7 billion


Management services

$125 million

CGG Veritas

Oil-field equipment and services

$8.5 billion


Aerospace and defense

$1.2 billion

Manulife Financial

Life insurance

$62 billion

Atwood Oceanics

Oil and gas drilling

$2.4 billion

ICF International

Business services

$394 million


Oil-field equipment and services

$334 million

Manulife is by far the biggest of the two large caps on this month's top-10 list, and not without good reason.

Sure, the Toronto company's major growth spurt may be behind it -- the stock is up more than 280% since September 2002 -- but that doesn't mean the company has run out of long-term-growth potential. On the contrary, Manulife has extended its business into China and other Asian markets. And the venture across the Pacific seems to be paying off: In August, the company reported that Asia Territories Life Insurance sales were up 42% year over year.

Bullish sentiment for Manulife is strong in the CAPS community. Of the 185 CAPS players who have rated Manulife, 183 think the stock will outperform the Standard & Poor's 500 Index ($INX) going forward. CAPS investors cite Manulife's Asian operations and growing dividend as major reasons why they think the stock will outperform.

You can learn what other CAPS investors are saying about Manulife by clicking here. If you'd like to voice your opinion about Manulife, or any other company for that matter, join the 65,000-strong MSN Money CAPS community now, and make your voice heard. CAPS is 100% free.

This article was reported and written by Todd Wenning for The Motley Fool. At the time of publication, he owned shares of Procter & Gamble.

Rate this Article

Click on one of the stars below to rate this article from 1 (lowest) to 5 (highest). LowHigh
The Motley Fool on MSN Money