) -- What's likely to be another challenging week for investors is kicking off today -- and once again, successfully navigating it is going to rely on finding pockets of strength in this market . . .

From a fundamental standpoint, that strength is definitely present, even if economic data are being a drag on stock performance this month. Indeed, while the

S&P 500

has shed more than 13% so far in August, it's less a symptom of poor corporate performance than it is the result of high levels of anxiety in the market itself. And as investors put on fear trades, they're leaving equities on sale at a historic discount this month.

To find the plays least likely to get shellacked amid market weakness, we're turning to the Rocket Stocks.

For the uninitiated, Rocket Stocks are our list of companies with short-term gain catalysts and longer-term growth potential. To find them, I run a quantitative screen that seeks out stocks with a combination of analyst upgrades and positive earnings surprises to identify rising analyst expectations, a bullish signal for stocks in any market.

It's a strategy that's been working out pretty well. In the last 117 weeks, Rocket Stocks have outperformed the S&P 500 by 84.3%.\


5 Stocks Setting Up to Break Out

With that, here's a look at

this week's Rocket Stocks


Limited Brands

In spite of the selling, 2011 has proven to be a reasonably good year for specialty retailer

Limited Brands


. Shares of the firm have climbed 8% year-to-date, ratcheting the firm's outperformance over the S&P to almost 20% this year. Limited owns a portfolio of popular retail store concepts that include Victoria's Secret, Bath & Body Works, and White Barn Candle Co. -- all specialty retailers that have fared well in spite of the pressures on discretionary consumer spending this year.

Limited's store portfolio has benefitted immensely from management's willingness to break conventions, including going as far as selling the firm's underperforming namesake Limited brand. The real jewels in Limited Brands' crown are Victoria's Secret and Bath & Body Works, two names that have immense market share in the U.S., but are now also facing saturation without additional room to grow. To combat that, the firm is looking abroad for growth opportunities.

Management, namely founder Leslie Wexner and his wife Abigail, own a massive chunk of outstanding shares of Limited. That should be helpful in ensuring that shareholders have some sort of backstop to the selling we're seeing in this market. With analyst sentiment on the upswing, we're betting on shares this week.


Swiss power and automation firm

ABB Ltd.

(ABB) - Get ABB Ltd. Sponsored ADR Report

is all about efficiency. The firm's products are all designed to increase efficiency and save costs for customers, who tend to be utilities or industrial firms that have significant power needs. By reducing power consumption and redundancies at customer firms, ABB has carved out a nice economic moat for its niche.

Not surprisingly, emerging markets are becoming an increasingly important portion of the firm's sales. As developing countries look to invest in their power infrastructure, ABB's products are often the first choice -- and as a result, sales from developing countries, in the aggregate, now contribute more to ABB's top line than developed country sales. That's a serious trend for investors looking to get exposure to growth markets.

By far, one of ABB's biggest assets is its base of intellectual property and expertise. Ultimately, those two factors typically lead to more cost savings than competitors can muster, a very important leg up for the firm. Expect margins to expand as sales volume continues to creep higher.


It was inevitable that we'd see another appearance from Rocket Stock favorite


(MCD) - Get McDonald's Corporation (MCD) Report

this month. We've already turned to this stock a couple of times in the face of significant broad market selling -- and the move has paid off in spades. As of this writing, shares of McDonald's are actually up in August.

McDonald's is the league leader in the fast food restaurant business, with more than 32,800 restaurant locations spread across 117 countries. The firm's positioning as a low-priced restaurant chain means that consumers are more likely to trade down to Big Macs and McNuggets when times are tough -- and new premium offerings mean that the company retains a bigger chunk of people (and expands margins) when times are good.

All told, the average McDonald's location grosses more than twice as much as the industry average. It should come as no surprise that this company is minting cash even now.

The firm's operating structure is also unique. The vast majority of McDonald's restaurants are franchised, which means that the golden arches' Illinois HQ is able to collect consistent franchise fees that generate significant free cash for investors. A 2.8% dividend yield and a history of share repurchases are couple of examples of how management typically uses that cash to return value to investors. Investors anxious about the market would do well to buy this defensive name.

Virgin Media

Virgin Media


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is a UK-based cable TV operator whose service footprint covers approximately two-thirds of the country's population. While the firm is the underdog in the pay-TV segment, it's quickly catching up to become a league leader in the broadband internet business, boasting connection speeds that incumbents can't match.

The communications business is fragmented in the UK, and Virgin Media is working to increase the number of cross-selling opportunities it can get from its current cable base. Offering services like broadband or phone to existing cable customers is far more profitable for Virgin -- and typically preferable for consumers as well. If the company can successfully sell bundled services to its 4.8 million customers, expect revenues and margins both to increase significantly.

Cable is a capital-intense business, and Virgin Media is no exception. While a heavy debt load has previously been a major shareholder concern, recent restructuring takes a considerable amount of pressure off of management in the short-term. With analyst sentiment on the upswing for Virgin Media, we're betting on shares.


With the turbulence in the economy right now, it may seem strange to talk about a stock like


(V) - Get Visa Inc. Class A Report

, a stock that's nearly a pure-play on consumer spending. But the fact remains that Visa has significant winds at its back as consumers switch their nondiscretionary spending from traditional methods (cash and check) to Visa's behemoth network. Investors shouldn't discount this stock just yet.

Visa is the largest payment network, with its logo on nearly 60% of the world's credit and debit cards. At this point, Visa's success is self-perpetuating: its dominance as a payment card means that merchants are essentially obligated to accept it, and that universal acceptance keeps Visa-branded products in consumers' wallets.

One of the most attractive aspects of Visa's business is the fact while that the firm benefits from higher dollar-volume passing through its network. It also doesn't bear the credit risk seen at peers like

American Express

(AXP) - Get American Express Company Report

, which issue their own cards. Because Visa only facilitates payments, the firm gets most of the upside and little of the risk.

Visa should continue to do well in 2011.

To see all of this week's Rocket Stocks in action, check out

the Rocket Stocks portfolio

at Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.


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At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji is the editor and portfolio manager of the

Rhino Stock Report

, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including




, and has been featured in

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