Monday's Biggest Stock Stars

Hey there, Fools. I've summoned our Motley Fool CAPS community once again to highlight a few of Monday's biggest winners among the stocks with a top rating of four or five stars.

Without further ado:

There's a reason why I selected those notable gainers, as opposed to other winners making noise on Monday, like low-ranked banks Citigroup (NYSE:C) and HSBC. Stocks go up all the time, but unless you were able to predict the pop, what does it matter?  

Our community of more than 130,000 CAPS Fools considers its "high-star" stocks the most likely to outperform the market.

Written in the stars?
For example, 88.5% of the 531 All-Star members who've rated FedEx have a bullish opinion of the stock. Two weeks ago, one of those Fools, bobbyvee, explained why the shipper was ready to deliver market-beating results:

When this recession finally bottoms, FedEx will lead the transports as a leading indicator of the recovery. Inventories continue to be cut, and when this global economy does turn around, FedEx will help refill the pipeline.

Consistent with that call, shares of FedEx gained nicely yesterday on Fed Chairman Bernanke's forecast that the recession would likely end this year and "pick up steam over time."

The bullish lesson?
Learn to embrace the bargains that only bad news can provide. Like CAPS' bobbyvee understands, industry champions often move higher well before the economy or sentiment turn, so it's important to buy while there's still blood in the streets. As Warren Buffett recently wrote, "[I]f you wait for the robins, spring will be over."

And now for the losers ...
Of course, winning isn't everything in the stock market.

Here are five of Monday's biggest decliners with one- or two-star ratings:   

While yesterday's drop in five-star construction stock Fluor may have caught our community off guard, low-ranked stocks are fully expected to fall hard.

Did CAPS call the fall?
Last month, for instance, CAPS All-Star Snowhound described Sprint Nextel in strictly bearish terms:

Poor customer service. Coverage is spotty in our area compared to Verizon and even AT&T. Delayed voicemail messages gets annoying. … Financially they are not much better. … Negative profit margins, negative revenue growth and they continue to lose customers while other carriers are adding.

In line with that warning, shares of Sprint Nextel sank yesterday after an analyst downgraded the stock on evidence that it was losing more Nextel customers than expected.

The bearish takeaway?
Trust your own eyes above all else. Just as it might pay to "buy what you know," it's probably a good idea to stay away from stocks whose services are increasingly disappointing you (chances are, you're not the only one). Due diligence is always required, but as CAPS' Snowhound understands, if you're not a satisfied customer, it might be a stretch to think you'll be a satisfied investor. 

The final Foolish move
Investors often focus strictly on stock price movements without realizing that developing a proper stock-picking process counts most.

Over on Motley Fool CAPS, thousands of investors are Foolishly sharing insightful investment tips to help, above all else, identify tomorrow's big movers. Over time, consistently reverse-engineering winning -- and losing -- stocks will help you become a more Foolish investor.

Log in to CAPS today and start participating. It's absolutely free -- and a lot of fun!