However hard the market slams a stock, there's always the chance it'll come bouncing right back. We'll consult our Motley Fool CAPS community to find shares on the rebound, examining one specific sector of the economy in search of companies with rising CAPS ratings.
Among the 298 stocks listed under industrial goods in the CAPS' screener, we've unearthed more than a few with five-star ratings. Those accolades mean our 160,000 CAPS members are confident that these stocks will beat the market in the months ahead; let's see what members are saying about the five below:
|
Company
|
CAPS Rating
(out of 5)
|
Recent Price
|
52-Week
Price Change
|
Est. LT
Growth Rate
|
|
Cemex (NYSE: CX )
|
*****
|
$10.46
|
69%
|
79%
|
|
China Valves Technology
|
*****
|
$13.93
|
248%
|
30%
|
|
Exide Technologies (Nasdaq: XIDE )
|
*****
|
$5.56
|
66%
|
NA
|
|
Ultralife (Nasdaq: ULBI )
|
*****
|
$4.18
|
(41%)
|
18%
|
|
Xinyuan Real Estate
|
*****
|
$4.00
|
(7%)
|
35%
|
Source: Motley Fool CAPS and Yahoo! Finance. LT = long-term.
As the broader market averages have staged a pretty bold recovery, industrial goods stocks have done even better. The average industrial goods company has jumped in value from the year-ago period, twice as well as the S&P 500. Of course, those returns include some strong performances from the likes of heavy-duty-equipment maker Ingersoll-Rand, which rose 133%, and gaming technology leader Shuffle Master (Nasdaq: SHFL ) , which nearly tripled in value. Nice work if you can get it.
So let's take a closer look at why investors think that some of these companies won't be jumping from the frying pan into the fire from the market's lofty heights.
Some spring in its step
It's an interesting juxtaposition that two battery makers should have such dramatically different results in the same time period. Ultralife focuses more on consumer-oriented, nonrechargeable batteries (more than a third of its revenue last year came from standard batteries), while Exide Technologies batteries are used primarily in automotive and industrial capacities.
Unfortunately for Exide, it just lost a big market for its car batteries as Wal-Mart (NYSE: WMT ) decided to drop it as a supplier in favor of Johnson Controls (NYSE: JCI ) and Delphi Automotive. I'm sure it doesn't help matters much that with all of its runaway cars, Toyota (NYSE: TM ) is also one of its large customers.
Both battery companies, though, maintain high levels of investor support, with 93% of the CAPS members who rated it believing Ultralife will outperform the market. In Exide Technologies' corner, the bulls are 97%.
Solid as a rock?
Mexican cement maker Cemex has been suffering recently despite previous gains, but it's not so much a loss of customers as the mountain of debt it assumed when making ill-timed acquisitions. While scrambling to pay the bills, it remains an ugly stock and the debt remains on investors' minds.
Even while thinking it may benefit from the rebuilding under way in Haiti and Chile, CAPS member Linsen83 worries about whether Cemex's debt load is really just a pair of cement shoes. GCC1 sees it as having to pursue a new strategy for growth, and that increases risk:
Historically pursued a growth strategy through acquisitions but with huge debt and too much exposure to the US, management will have to rethink a new strategy. Will they now follow a Lafarge or Holcim model?
Head over to the Cemex CAPS page and pour a good footing for this company to make a rebound from past mistakes.
The ball's in your court
There are many factors that go into whether a stock is a buy or sell, so it pays to start your own research on these stocks on Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made -- all from a stock's CAPS page. Head over to CAPS today and share your thoughts with other investor analysts on whether you think these stocks are ready to bound higher.
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