In a broadly diversified portfolio, it always pays to hold a batch of blue-chip stocks and a few more speculative names. Some of these speculative names can surge very quickly, giving your portfolio a healthy boost.

Since the start of 2011, roughly a dozen stocks (with a market value of at least $1 billion) have risen more than 60% in value.

 

Some of these companies toil in the energy sector, which has gotten a material lift from rising energy prices. Whether these stocks can climb even higher is simply a function of future energy price trends, for which we hold no crystal ball. But here are three names that are poised to make another move.

1. Broadsoft (Nasdaq: BSFT)
This stock has all the signs of bubble. Broadsoft, which makes communications software, has a limited history as a public company, having gone public just nine months ago. Since then, the company’s thin float paired with several strong quarters has pushed the stock up more than 400% in just four months.

The euphoria has been somewhat understandable. Sales surged 39% in 2010, more than twice the expected rate when the company first went public last June. And sales could rise more than 20% in 2011 and 2012 based on current business trends. But that’s how you need to see this — as a three-year growth story.

Broadsoft operates in a mature industry that is in the midst of a near-term upgrade cycle. Telephone and cable companies are spending heavily to better manage all the multimedia sessions being handled on their networks. Once the software is in place, this niche should look like many other telecom software niches — mature and slow-growing.

Momentum investors are clearly focused on the present, noting that earnings per share (EPS) could double from 2010 to 2012 to around $1 a share. Shares trade for more than 50 times that view. Yet, profit growth looks set to cool beyond 2012 — that’s simply the nature of telecom spending. It is intensely directed to certain areas for a short stretch, and then the carriers move on to focus on another area.

Perhaps the main reason shares are so lushly valued is the expectation that Broadsoft will be acquired. That’s one of the main challenges to shorting a stock like this. Yet, if no suitor emerges in coming months, then those momentum investors may no longer choose to wait around.

2. IPG Photonics (Nasdaq: IPGP)
This company has also surged in recent months, but its valuation is more attractive and its growth opportunities could extend well into the long-term. IPG owns a wide range of patents on the use of lasers in telecom networks, medical technologies and industrial applications. As is the case with Broadsoft, IPG has been on a tear. Sales shot up 60% in 2010 and per-share profits rose by nearly 1,000%. Backlog is surging, which is why analysts think sales could grow another 40% this year.

Yet, this company may just be getting going. Demand for the company’s lasers is surging in China, where a wide range of manufacturers are using IPG gear for cutting, engraving and welding. In Russia, the company has garnered interest for the use of lasers in fiber-optic telecom networks. IPG’s Russian subsidiary is partnering with a leading Russian technology firm, RUSNANO, to help develop opportunities.

It all comes down to valuation. Whereas Broadsoft trades for 200 times trailing earnings, IPG trades for 50 times trailing earnings. And while Broadsoft trades for 50 times projected 2012 profits, IPG’s forward multiple is about 20. Both of these are high-growth businesses, but IPG’s long-term view is perhaps even brighter than Broadsoft’s — and its stock is noticeably cheaper.

3. Manitowoc (NYSE: MTW)
Wherever you see construction sites, you usually see cranes. And many times you’ll see the name “Manitowoc” painted on their sides, as this company is the world’s largest crane supplier. Manitowoc is finally on the mend after a brutal few years. Customers stopped ordering cranes in 2008 and 2009 since there were so many used cranes available on the second-hand market after a number of global real estate construction jobs were shut down. Sales peaked at $4.5 billion in 2008 and then slumped for two straight years, turning years of profitable results into a pair of money-losing years.

Manitowoc is now bouncing back, reporting swelling demand for its cranes. As long as the global economy doesn’t stumble, the next few years could be quite robust. Goldman Sachs sees profits steadily building, hitting $2.50 a share by 2013, compared to $0.16 in 2010. Shares surged mightily on Feb. 1 as investors took note of Manitowoc’s vastly improved outlook. That led analysts at Brean Murray Securities to note that “despite the almost 30% run-up in the stock price today, we believe the stock may be cheaper now than in the last week given the tangible earnings profile and inflection in crane orders and profitability.”

Despite the recent strong run, shares appear reasonably-priced at just 15 times the 2012 consensus profit forecast of $1.42. They trade for just eight times the Goldman Sachs 2013 forecast ($20 / $2.50 = 8). As a cyclical play, shares will never get a high multiple, but if the global economy can be on a sustained growth path into the middle of the decade, then profits have room to rise further. And so do the shares. They still trade for less than half of the levels seen three years ago — the last time the global economy was healthy. I don’t expect shares to hit $50 again anytime soon, if at all, but a move from $20 to $30 or even $35 isn’t out of the question.

Action to Take –> If you are going to pursue hot stocks like the ones in the table above, you have to pay attention to valuations. Reasonable multiples will help prevent major downside moves if these growth stories have any hiccups along the way.

Of the three stocks I mentioned, Broadsoft is the obvious short. It’s a pure momentum stock that, barring a takeover, is likely to fall soon. Manitowoc seems like the safer play, possessing 50% upside or more. IPG is a bit riskier but could do even better as a long-term holding.

P.S. — I don’t know if you’re aware of this or not, but a 20-year energy agreement between the United States and Russia is about to expire. The problem is, this deal supplies 10% of America’s electricity. When the Russians refuse to renew the agreement, the U.S. will face an entirely new kind of energy crisis. This disruption could send a handful of energy stocks through the roof. Keep reading…