March 22, 2007

Small Cap- NEOGEN

From the Fool:

Once again, our CAPS database manages to stick a five-star rating on a little-known stock growing at an impressive clip. Neogen, a leading provider of food and animal safety products, has seen its revenue increase in 59 of the last 64 quarters, while the company has posted profits for 55 quarters in a row. That's part of the reason it's regularly named by Forbes magazine as one of the 200 Best Small Companies in America.

Through its food safety and animal safety divisions, Neogen develops diagnostic test kits to detect all sorts of harmful things like foodborne bacteria, food allergens, and mycotoxins. As fellow Fool Anders Bylund notes, Neogen owns a solid patent-protected portfolio, making competition virtually nonexistent.

In the latest quarter, Neogen posted a 26% increase in net income on 21% revenue growth -- and these CAPS players detect similar bacteria-free growth in the future:

* SomeKindaFool: "This is one of those small companies with lots of room to grow. Food safety and animal health testing are their core businesses, both of which have a great deal of potential upside these days. Like most small companies, the stock price has not been steady. It has had its ups and downs, but if you plan to hold for a couple years or more, it should provide good price appreciation."
* empirefool: "Strong management in an undeservedly beaten down sector. Although the company is considered a bio-tech they're involved in the very boring business of animal feed testing. The Company has a sound acquisition strategy and consistent ROIC. Unfound by analysts."

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