I use 1mm razor form to wrap most of the smaller bodies I tie. It stretches some, but it still requires you have a smooth underbody when you wrap it. I don't like most of the foam that I have found in a craft stores. Most of it has too much plasticizer which makes it too stiff. I like the foams that are especially made for fly tying. They are softer, which makes it easier to compress, and thread doesn't cut them as easily. They have some stretch and give built into them.
"Have no fear of perfection - you'll never reach it."