July 2, 2008 11:34AM

Today’s “Stock You’ve Never Heard Of”

By Brian Sullivan

Last week it was the design and distribution of pumping equipment for the oil and gas industry when we discussed DXP Enterprises (DXPE).   This week its the the filtration industry, as Donaldson Company (NYSE: DCI) came up as meeting the stock and growth metrics I use to find companies for this segment (revenue and EPS growth greater than S&P 500 over 3 years with no significant valuataion premium and little analyst coverage).   Who says we don’t learn anything about the industrials?

Three year revenue and EPS growth for this Minneapolis-based company are 11.3 and 17.3% respectively.   That tops the S&P 500 in both categories.   Even though its cooled off with the overall market in the last few months, the stock (below) has had a nice run.

In our interview CEO Bill Cook noted that sales were growing in nearly every business unit.    That includes the truck engine market.   Cook noted that regardless of how the overall trucking market is doing, new emissions regulations coming down the pike are forcing engine makers to upgrade their  filtration systems.     The company also gets much of its sales overseas, taking advantage of the weaker dollar.    Operating margins are also on the rise.

The full interview is on www.foxbusiness.com.

By the way, next week there will be no segment because I am anchoring the 1-2pm and 6-7pm shows.    Tune in.