"Five-tool player" is a term used by baseball scouts to describe a player who has a well-rounded offensive and defensive game. The term does not apply to pitchers or designated hitters, only positional players. This type of player is a particularly difficult thing to find in baseball, because it requires such a wide range of skills. Moreover, they are skills that often don't go together, like speed and power, but the player is able to encompass them all.
The five tools are:
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Hitting for power - A five-tool player must be able to hit for power. This means he has the ability to hit home runs and hit for a high slugging percentage, a statistic that measures the frequency of extra-base hits.
Hitting for average - While it's important for a five-tool player to hit the ball out of the park, he must also hit for a high batting average. This means he must be able to hit to the opposite field, hit for contact with two strikes, and just generally adapt his hitting approach to the situation in the game.
Speed - This refers specifically to speed on the basepaths. A five-tool player must have speed in order to maximize extra base hits, which dramatically improve a team's chances of scoring runs. He must also be a threat to steal bases, which puts more pressure on the opposing pitcher, catcher and defense.
Fielding - A five-tool player must be as skilled in the field as he is at the plate. Saving runs defensively can be as important as creating them offensively, so it's important that the player be a good fielder. Speed helps here, too, especially if the player is an outfielder and needs to cover wide open spaces of the field.
Throwing - An extension of a player's fielding ability, throwing can be a key element to a five-tool player's arsenal, especially if he is a third baseman or shortstop, which must be able to throw quickly and accurately across the diamond to first base. A strong throwing arm is also important for an outfielder, because it can be used to throw out runners or merely to make them think twice about going for an extra base.