By Ben Levisohn

These days, everyone wants a bite of the construction appleand analysts are falling all over themselves to upgrade companies with exposure to commercial spending. Citigroup did it when looking at the industrial space today, and Morgan Stanley is following suit with its look at the machinery space and upgrade of Manitowoc (MTW ).

Dan Neil

Analyst Nicole DeBlase and team write:

Seek out Construction exposure and use caution when investing in Ag and Mining -driven names. We now officially classify ourselves as Non-Resi bulls – we believe 2014e will (finally) be the year of recovery, with increased confidence stemming from leading indicators and the fact that homebuilders are now constructing new communities. Although [consensus] bakes in a mild recovery (

5% Non-Resi growth), once this begins to play out, positive sentiment, stronger incremental margins, and 2015-16e upside should drive [outperformance]. At the same time, we cannot yet identify the demand trough for Ag/ Mining equipment – although we are probably closer for Mining than for Ag.

But dont just buy any company, DeBlase says. Instead, focus on those that have EPS momentum, which has generated outperformance in 10 of the past 11 years, DeBlase says. As a result, investors should prefer Terex (TEX ), her top pick, and Agco (AGCO ), which she rates Outperform. John Deere (DE ) and Parker Hannifin (PH ) get tarred with Underweight ratings.

Its Manitowoc that gets the upgrade, however. DeBlase explains:

When we launched coverage of [Manitowoc] in Sept, the sole reason behind our [Equal Weight] recommendation was our skepticism around the timing of a Non-Resi recovery. However, over the past two months, we have become increasingly bullish on the end market outlook, on the back of improving leading indicators (Dodge, ABI) and growing Resi active community count (now happening for the first time this cycle). As such, we project 5% US Non-Resi investment growth, which should translate to 10%+ growth in Crane sales by 2015e

Deblase now rates Manitowoc Overweight.

Shares of Manitowoc have gained 4.4% to $23.95 today at 2:44 p.m. while Terex has risen 2.4% to $40.88. Agco has fallen 1% to $57.03, Deere has dropped 1% to $89.37 and Parker Hannifin is little changed at $127.59.