One of portfolio manager Ron Baron’s goals is to find stocks that could double in price within four to five years. To accomplish this, he looks for companies that face little competition because barriers prevent others from entering the business. A company should also have predictable earnings that are likely to grow steadily for years. Insight: Such reliable companies tend to be in “simple” industries that are very unlikely to be disrupted suddenly by changes in technology. Because he likes stocks with moderate price-earnings (P/E) ratios, Baron often buys after shares have dropped. The current downturn has presented many unusual bargains, he says. His favorite picks include…

Fastenal Company (FAST). This maker of bolts, nuts, screws and specialized fastening and building supplies flies under the radar of many investors even though it is a component of the Standard & Poor’s 500 stock index. The company has a highly trained workforce, which gives it an edge in dealing with a huge inventory that requires tremendously efficient technology and transportation systems. It should gain more market share from struggling Mom and Pop hardware stores as the economy weakens. The Obama administration’s expected increased spending on infrastructure should help boost Fastenal’s sales for years to come. Market capitalization: $5.08 billion. Recent share price: $32.46.

Lamar Advertising Company (LAMR). This midsized firm sells outdoor advertising services, including space on approximately 151,000 billboards. The company faces limited competition because today’s tough zoning laws make it very difficult to construct new billboards. Market capitalization: $1.25 billion. Recent share price: $12.23.

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