BOSTON ( TheStreet) -- Best Ideas, stock picks that Morgan Stanley ( MS) says have the most favorable risk-reward profiles, is now just over a year old.

Last year's selections fared well. Though not recommended as a portfolio, several of the Best Ideas stocks delivered solid gains since publication in October 2009. Here's a closer look at the recommendations and their performances.

The S&P 500 has gained 17% since Oct. 1, 2009.

Baker Hughes ( BHI) has risen 30%.

Bank of America ( BAC) has fallen 30%.

Celgene ( CELG) has increased 0.1%.

Danaher ( DHR) has climbed 37%.

Hewlett-Packard ( HPQ) has dropped 9%.

Suncor Energy ( SU) has advanced 4.6%.

Textron ( TXT) has appreciated 30%.

Union Pacific ( UNP) has soared 58%.

Walt Disney ( DIS) has increased 36%.

In sum, five of the original nine picks have outperformed the S&P 500. Here is a look at Morgan Stanley's eight Best Ideas heading into 2011.

Below, the stocks are ordered by their predicted upside, from modest to mammoth.

8. BorgWarner ( BWA) manufactures and sells engineered automotive systems.

Fundamentals: BorgWarner's 12-month sales have soared 44%. Third-quarter profit quintupled to $107 million, or 87 cents a share, as revenue grew 37% to $1.4 billion. The operating margin widened from 2.5% to 8.7%. BorgWarner has $432 million of cash and $1.3 billion of debt, equal to a quick ratio of 1.1 and a debt-to-equity ratio of 0.5. Management is forecasting $2.3 billion of net new powertrain business between 2011 and 2013.

Valuation: The stock trades at a trailing earnings multiple of 25, a forward earnings multiple of 18, a book value multiple of 3.4 and a cash flow multiple of 17, 28%, 46%, 76% and 41% discounts to auto components peer averages. Its PEG ratio, a measure of value relative to growth, of 0.1 reflects a 90% discount to estimated fair value. Morgan Stanley's bullish scenario entails a 51% stock-price rise to $100. Its bear-case target is $45.

7. Scripps Networks ( SNI) is a lifestyle content and interactive services company. It owns Home and Garden Television, Food Network and Travel Channel, as well as associated Web sites.

Fundamentals: Scripps' 12-month sales have increased 27%. Third-quarter profit surged 56% to $102 million, or 61 cents a share, as revenue increased 40% to $509 million. The operating margin extended from 34% to 38%. Scripps has $417 million of cash and $884 million of debt, converting to a quick ratio of 4.9 and a debt-to-equity ratio of 0.5. A rebound in corporate advertising budgets has benefitted Scripps. Quarterly ad sales rose 34%.

Valuation: Scripps' stock sells for a trailing earnings multiple of 26, a sales multiple of 4.5 and a cash flow multiple of 19, 28%, 94% and 75% premiums to media industry averages. The shares are fairly valued based on book value and forward earnings. The stock's PEG ratio of 0.6 demonstrates a 40% discount to estimated long-run fair value. Morgan Stanley's bullish-scenario stock valuation is $75, suggesting 45% upside. Its bearish-scenario stock valuation is $37.

6. Apple ( AAPL) sells consumer electronics, including MacBook laptops and the iPad tablet.

Fundamentals: Apple's 12-month sales have expanded 52%. Fiscal fourth-quarter net income surged 70% to $4.3 billion. Earnings per share advanced 68% to $4.64, restrained by a higher share count. Revenue grew 67%. The operating margin declined from 30% to 27%. Apple held $51 billion of cash and marketable securities at the end of the quarter and no debt, converting to a quick ratio of 1.7. It is one of the most liquid U.S. companies.

Valuation: Apple's stock trades at a trailing earnings multiple of 21 and a forward earnings multiple of 15, on par with computer and peripheral industry averages. Its book value multiple of 6.1, sales multiple of 4.5 and cash flow multiple of 16 reflect premiums of 27%, 39% and 17% to hardware and peripherals peer averages. Yet, the stock's PEG ratio of 0.8 indicates a 20% discount to estimated long-run fair value. Morgan Stanley's bull target is $500. Its bear target is $250.

5. Union Pacific ( UNP) provides rail transportation.

Fundamentals: Union Pacific's 12-month sales have risen 11%. Third-quarter net income rose 51% to $778 million and earnings per share stretched 54% to $1.56. Revenue ascended 20%. The operating margin rose from 26% to 32%. The company held $1.4 billion of cash and $9.7 billion of debt at quarter's end, equal to a 0.8 quick ratio and a 0.6 debt-to-equity ratio.

Valuation: Union Pacific's stock sells for a forward earnings multiple of 15, a 23% discount to the road and rail industry average. It's fairly valued based on trailing earnings, book value and cash flow per share. But, the stock's PEG ratio of 0.4 signals a 60% discount to estimated long-run fair value. In Morgan Stanley's bull-case scenario, Union Pacific's stock will advance 28% to $121. In the bank's bear-case scenario, the stock will decrease 10% to $85.

4. Tyco International ( TYC) is an industrial conglomerate. Its subsidiaries sell products ranging from security devices to industrial valves.

Fundamentals: Tyco's 12-month sales have risen a paltry 0.9%. Fiscal fourth-quarter profit expanded 30% to $266 million, or 55 cents a share, as revenue ascended 4% to $4.5 billion. The operating margin stretched from 9.6% past 10%. Tyco held $1.8 billion of cash and $4.2 billion of debt at the end of the quarter, translating to a quick ratio of 0.8 and a debt-to-equity ratio of 0.3. Amid tepid sales growth, cost reductions have bolstered net income.

Valuation: Tyco's stock trades at a forward earnings multiple of 12 and a book value multiple of 1.4, 21% and 37% discounts to industrial conglomerate industry averages. Its trailing earnings multiple of 18, sales multiple of 1.2 and cash flow multiple of 7.6 are on par with conglomerate peer averages. The stock's PEG ratio of 0.6 reflects a 40% discount to estimated fair value. Morgan Stanley offers a bullish-scenario target of $61 and a bearish-scenario target of $32.

3. Republic Services ( RSG) provides waste collection, transfer and disposal services.

Fundamentals: Republic's 12-month sales have risen 8.6%. Third-quarter net income increased 11% to $134 million and earnings per share climbed 9.4% to 35 cents. Adjusted profit stretched an impressive 16% year-over-year. Revenue declined marginally to $2.1 billion. The operating margin remained steady at 20%. Republic carried $121 million of cash and $6.9 billion of debt at quarter's end, converting to a quick ratio of 0.4 and a debt-to-equity ratio of 0.9.

Valuation: Republic's stock sells for a trailing earnings multiple of 28, a forward earnings multiple of 15, a book value multiple of 1.4, a sales multiple of 1.4 and a cash flow multiple of 8.2, 22%, 27%, 54%, 36% and 44% discounts to commercial services peer averages. Its PEG ratio of 0.9 represents a 10% discount to estimated long-run fair value. Morgan Stanley offers a bullish-scenario target of $50 and a bearish-scenario target of $22. Its base-case target is $38.

2. Ford ( F) is the second-largest U.S. carmaker.

Fundamentals: Ford's 12-month sales have increased 19%. Third-quarter net income rocketed 69% to $1.7 billion. Earnings per share climbed 48% to 43 cents. Revenue declined 1.3%. The operating margin rose from 7.7% to 10%. Ford had $33 billion of cash and $117 billion of debt at quarter's end. Ford is running a shareholders' deficit. However, after enduring four consecutive quarterly losses in 2008 and 2009, it has returned to profitability.

Valuation: Ford's stock trades at a trailing earnings multiple of 9.4, a forward earnings multiple of 7.9 and a sales multiple of 0.4, 39%, 63% and 53% discounts to automobile industry averages. It's costly based on cash flow per share. Still, a PEG ratio of 0.1 represents a 90% discount to estimated fair value. Morgan Stanley's bullish target is $31, implying the stock might double.

1. Schlumberger ( SLB) is an oilfield-services company, selling supply technology, project management and information services.

Fundamentals: Schlumberger's 12-month sales inched up 1.2%. Third-quarter profit more than doubled to $1.7 billion, or $1.38 a share, as revenue gained 26% to $6.8 billion. Adjusted profit gained a more modest 7% sequentially and 11% year-over-year. The operating margin fell from 18% to 16%. Schlumberger held $2.6 billion of cash and $6.7 billion of debt at quarter's end, translating to a quick ratio of 1.1 and a debt-to-equity ratio of 0.2.

Valuation: Schlumberger's stock sells for a forward earnings multiple of 22, a 9% discount to the energy equipment and services industry average. Its book value multiple of 3.7, sales multiple of 4.7 and cash flow multiple of 21 reflect premiums of 25%, 52% and 13% to energy peer averages. Although seemingly expensive, Morgan Stanley has a bullish-scenario target of $180 for Schlumberger, corresponding to 57% upside. Its bearish-scenario target is $50.

-- Written by Jake Lynch in Boston.

To see these stocks in action, visit the Morgan Stanley's 8 Best Stock Ideas Portfolio on Stockpickr.

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Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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