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Kevin Poe wants to keep you in the dark. It's for your own good, he says, not to mention the planet's.
A charismatic Bryce Canyon National Park guide who fancies himself the "Dark Ranger," Poe is on a one-man crusade to urge cities, companies and individuals to reawaken to the glories of the night sky. In a series of slide-show lectures given at parks nationwide, he explains why "light pollution" -- the excess of nighttime illumination in most corners of the civilized world -- ought to rank with water and air pollution among the damnable scourges of industrialization.
Considering that there's a trillion times more sky than there is terra firma, Bryce is a place that makes you realize how much we've lost in the manic quest to illuminate modern life. Poe would prefer that we use flashlights when we absolutely must brighten our paths, but that is not exactly practical for inveterate city dwellers who enjoy conveniences like night baseball and working past sundown.
I'm down with Poe all the way in theory, but you just know the cynic in me just can't stay in the dark. So today I want to share with you one of my favorite stocks of all time that's trading at an irresistible price. Sorry, Kevin, but it's Genlyte Group (GLYT, news, msgs), the nation's leading independent maker of commercial and residential lighting fixtures.
10 straight winning years
Genlyte may seem like an obscure choice for a favorite among all the thousands of public companies available for sale out there in the universe, but it has one unique feature that cannot be beat. Its shares have risen in each of the past 10 years, including 45% last year, 87% in 2003, 25% in 2001 and even 11% in 2000. Its compound annual return over the period is 28.5%, which totals to 1,110% in the past decade, or about 11 times better than the broad market. According to my research, there are very few more consistently profitable stocks. (See Fine Print for a few more.)The Genlyte story has been all about the consistency of revenue, earnings and cash-flow growth, which the company's managers have achieved at a high double-digit pace by buying every capable competitor in sight and skillfully blending them into a crack sales and marketing system. Shares right now are trading at a modest 12 times 2008 estimated earnings, which is well under Genlyte's projected growth rate -- making it an absolute bargain today.
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Why can you pick up this stellar performer on the cheap? Well, you may have heard the United States is experiencing a residential construction slowdown. We've been hearing about this crisis for so long, it seems that it must be almost over by now. But sadly, it is not. When you scan newspapers around the country, business sections continue to report on an industry in severe decline.
In the suburbs around Kansas City, for instance, home starts in March were down 38% from a year ago, according to the community's Sun Tribune. New permits for homes in Platt County, which is on the outskirts of Kansas City, were off by almost double that -- down 68% from a year ago last month.
The problem is that builders put up a lot of houses over the past couple of years while speculating there would continue to be a large influx of new buyers in the market. It's turned out that a lot of the marginal new buyers, though, were not creditworthy. Banks lent them cheap money, but only with loans that had the hidden time bomb of interest rate "kickers" that made payments unmanageable in many cases after a year. Many of these buyers have lost their homes to foreclosure, and their absence from the marketplace has left a gaping hole.
Continued: More than just home lighting
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