The leisure sector is the playground of several strong stocks. HomeAway (AWAY ) and Priceline (PCLN ) are leaders.

Investors generally are basing buys and sells on individual stock’s fundamentals. But many investors are fishing in the leisure pond because they expect to find winning stocks whose fortunes improve as the economy warms up.

Employment trends, higher real estate prices and the decline in commodity prices are positive catalysts for leisure spending by consumers, said Christopher Baggini, manager of $45 million Turner Titan Fund. which holds HomeAway among several leisure names.

Mutual funds have signed up for the sector’s fun and games. The $45 billion Fidelity Growth Company boosted its stake in Priceline (PCLN ) in its latest disclosure.

The $237 million Alger Large Cap Growth opened a position in Discovery Communications (DISCK ). The $78 million DWS Small Cap Core started a stake in Madison Square Garden (MSG ).

I want companies that are doing something new, said Fritz Reynolds, manager of $180 million Reynolds Blue Chip Growth .

HomeAway is using the Internet to publicize rental vacation homes. This is something that simply could not be done efficiently before the Net, Reynolds said.

Baggini says HomeAway has acquired and consolidated several online platforms. Now they can reap the benefits of the changes they made, he said.

Vacation Rentals

James Lamb, analyst for $850 million Loomis Sayles Small Cap Growth. says HomeAway recently introduced pricing tiers. Now owners can choose whether to get into a higher-priced tier, which has better placement online of their home and more photos, he said.

Baggini says acquisitions are one key to Priceline’s strength. It took over Booking.com in 2005, Agoda in 2007 and TravelJigsaw in 2010.

In November it said it was taking over Kayak Software, which collates results from multiple search engines. That takeover could help Priceline take a small step toward trimming costly reliance on Google (GOOG ).

Madison Square Garden is up 61% over the past 12 months.

It’s being driven by strong demand for content, said Ben Mogil, analyst for Stifel, Nicolaus. The company owns arenas, including its Manhattan namesake and Los Angeles’ Forum, in addition to theaters in several cities.

MSG has a moat around its ad pricing, Mogil says. Young male TV viewers, big consumers of sports, are less apt to tape events for later viewing. That means no fast-forwarding past ads.

Renovations of key venues will lead to higher revenues from tickets and refreshments, Mogil says. So should new player contracts in professional basketball and hockey.

MSG’s story has much more room to run, Mogil said.

Reynolds owns several car-rental stocks, including Alamo (ALG ), Avis (CAR ) and Hertz (HTZ ). Consolidation is giving them more control over efficiencies, Reynolds said.

He added that Avis, up 113% in 12 months, is doing better than the Street expected.

Car rental is another area that’s helped by the Internet and the improving economy, he said.