The six months before June 2008 have shown business diversification in very favorable light for stocks. Innumerable portfolios have come to grief because of their over-dependencies on one or the other segment of the world economy. Almost all stock investors, whether by hindsight or foresight, must look at stocks of diversified companies to weather the current market conditions until the next upswing.

Capital, human, physical and intangible resources limit diversification. A management team may wish to enter a new field of activity, but lack the capabilities to compete profitably and in sustainable ways. A wide client base gives a corporation most of the benefits of diversification, without requiring such diverse resources.

This is the case of a small-capital member of the Electronic Instrumentation & Controls Industry from Quincy, MA. Horticulture, foods, mining, aerospace, and logistics are examples of the breadth of industries which this company serves. It makes power transmission and motion control products.

Business performance is as impressive as the customer base. Sales growth and Gross Margin have been way above the industry average over the last four quarters. Annual growth of Earnings per Share during this period has been more than 75%. The Price to Earnings Ratio is below 25 as of early June 2008, with a price of $16.40 against a 52-week low of just $11.07. This corporation has business spread across 70 countries, and is thereby poised to take full advantage of economic growth almost anywhere.

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