5-Star Stocks the Leaders Have Soured On

Momentum investors are stock players who get behind companies that have the wind in their sails. Contrarian investors typically pick up the cigar butts that the market has tossed aside. So what do you call investors who turn against winners? Sourpusses? Shorts?

Over on Motley Fool CAPS, we sometimes call them the savviest investors around. Not only does the 65,000-strong investor-intelligence community rate thousands of stocks every day, but the players themselves are rated, too. The best of the lot -- what CAPS calls All-Stars -- consistently outperform their peers over time and are assigned ratings of 80 or greater.

When All-Star players sour on a top-rated five-star stock, we should take notice. Maybe they've uncovered the chink in the highflier's armor. It could be they've found a question mark in the footnotes of the company's financial statement. Maybe it's just a hunch. That's why we say these tables are not lists of stocks to buy or sell, but rather starting points for further research. With about 10,000 stocks in the universe to choose from, this list can drastically whittle down that number. Read the All-Stars' pitches for or against a stock, and then dive into the financials.

Here are four stocks the all-stars of the All-Stars -- those with player ratings of 90 or better -- have put the frowny face on:

More than 4,300 investors have rated these stocks, with an average 97% of them being bullish on their prospects, and a like number of All-Stars also think they'll outperform the market. What might have turned these top players against these otherwise widely admired companies?

All quiet on the bear front
It's a lonely road these All-Stars have taken. Their contrarian positions run against the tide of support these companies have been generating recently. Perhaps wcwhiner sees the China market ultimately as played out, or maybe there's just too much hype.

Even in looking askance at the immediate prospects of these companies, praise is still due for the underlying strength that caused them to earn their five-star ratings in the first place.

That might be why no one has bothered to pen a recent bear case against ViroPharma, even as its stock continues to drop after one of its hepatitis C treatments got whacked by negative data, and the company announced it will stop testing it.

A glowing endorsement
Meanwhile, USEC is an investor favorite. As miscidiot highlights, the company is the industry leader:

USEC spent an enormous amount of money on R&D for new centrifuge technology [and] a new 25% offering is to cover their new assets. [It's] worth it!! As the only uranium supplier in the US with international agreements committing the US and Russia as exclusive suppliers, how can you go wrong?

Well, lots could go wrong. Russia could stop selling enriched uranium to the company, or a chemical release could expose the company to all kinds of liability. Still, barring such cataclysmic events , USEC does look solid.

Yet as CAPS bear uraniumacidtest suggests, it's very dependent on others for its existence:

A fool and his money will soon part if you invest in USU. It is not a uranium company. They have NO uranium and NO assets and very little cash. They lease antiquated and costly technology and 50% of what they sell comes from Russia, Caveat emptor -- this one will be below $10 before [year's] end!

Raise your hand
We've heard both the bull and bear arguments here, but Motley Fool CAPS is more than just what the All-Stars think. We invite you to add your voice to the debate. Go ahead, have your say. We're eagerly waiting!