5 All-Star Stocks Fighting the Tide

When the clock's ticking down and the game's on the line, which of your teammates do you trust to sink a winning shot? Sure, you could dish the rock to your star -- but what if he's ice-cold at the moment? So instead, you pass to the guy with the hot hand, the one who'll be deemed en fuego tomorrow on ESPN.

Momentum investors are looking for stocks in a similar state of sizzle. But momentum by itself will only get you so far. I prefer to find high-quality stocks that also have some positive inertia. It's like kicking the ball out to your team's stars when they do have a hot hand.

There's no doubt that it's tough to try to find winners out there now, but to find the current league leaders, I ran a simple momentum screen on The Motley Fool's CAPS screener (you can run the same screen by clicking here). Each of the companies below posted gains of 5% or better over the past four weeks -- despite the S&P's big loss -- and has been rated highly by CAPS members.

Sources: Yahoo! Finance, Capital IQ (a division of Standard & Poor's), and CAPS as of Jan. 20.

At first glance, this sure looks like a high-quality group. But as always, I highly advise taking a close look before you throw a bounce pass in the direction of any of these stocks. In fact, I'll even start off your research with a look at Ingersoll Rand.

Providing the pep
It's tough to say exactly what excited investors the most about Ingersoll Rand over the past month. Maybe it was subsidiary Trane's contract with the Department of Energy that could be worth $5 billion over the next 10 years. Maybe it was the belief that heating, ventilating, and air conditioning (HVAC) manufacturers like Trane would benefit from stimulus spending under the new president. Or maybe it was simply that investors realized that the stock is begging to be bought.

My guess is that it was a little bit of all of the above -- or rather a general sense among investors that the 54% fall over the past year was a bit overdone.

Looking ahead
The anticipation of stimulus spending has helped buoy Ingersoll Rand's stock -- along with the stocks of materials and construction players such as Nucor (NYSE:NUE) and McDermott (NYSE:MDR) -- but investors will be looking to see what actually happens. There's no doubt that President Obama and congressional Democrats are taking an aggressive approach to fighting the recession: Though the $825 billion stimulus proposal is short of the $1 trillion-plus that some say is needed, it's no small chunk of change. Some wonder about where this stimulus money will actually end up and whether -- in the face of a major recession -- it'll be more than just spitting into the wind.

This makes the coming months a crucial time for Ingersoll Rand. If the stimulus does pump money into infrastructure and helps get the economy back on track, then the stock could bounce back pretty quickly. If the stimulus is stymied, or the recession makes the $825 billion look like a wimpy attempt, the company's businesses -- with the potential exception of security equipment -- may find themselves trying to push Sisyphus' rock.

Now most of this is relatively short-term -- even if we're talking a year or two. CAPS All-Star sandvig recently gave Ingersoll Rand's stock a thumbs-up.

The immediate future looks scary, but this is a solid company that is selling below book value. They will fare very well when the cycle runs its course. When will that happen? Who knows? But it will.

Fielding your team
So do you think any (or all!) of these companies deserves a place on your All-Star team? You can share your thoughts on it or check out more of what your fellow Fools had to say about it or any of the other stocks above by stopping by CAPS. And while you're there, you can also take a peek at a few more of the 5,400 or so other stocks that are rated on CAPS.

I think I heard a boo-yah somewhere out there -- thanks, Stuart Scott!

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