Fastenal, Winona company, is one of 2011's hottest stocks

A Minnesota company with a worldwide profile had a great 2011, and it isn't Target, Best Buy, Ameriprise or any of the usual suspects.

Winona-based Fastenal was one of this year's ten "hot stocks" according to a Slate analysis.

Fastenal's stock, which is listed on the S&P 500 index, began the year at $30.42 per-share but was trading at $43.69 on Wednesday -- an increase of nearly 46 percent.

The company, founded in 1979, pioneered the practice of selling nuts and bolts through vending machines. Fastenal now sells industrial and construction supplies in wholesale and retail fashion throughout the world, with stores in every U.S. state, every Canadian province, Asia, Europe, Central and South America.

According to a Barron's piece published in March 2010, 2009 was a brutal year for the company, and 2011 presumably represents a bounce back from the recession.

In 2009, sales and profits tanked, the company slashed 12 percent of its workforce and slowed the pace of store openings.

Barron's quotes CEO Will Oberton  as saying "we were always able to grow through previous economic slumps, but not this one, not at least last year."

With industrial and construction activity slowly picking up and the company expanding its overseas operations, Fastenal's stock price steadily increase through last year and continued to rise in 2011.

Regarding Fastenal's strong performance this year, Slate's Matthew Yglesias writes: "Its strong 2011 experience reflects, in part, its toehold in the booming China construction market. But it's also cause for optimism that U.S. construction is recovering from its doldrums."

A call and e-mails to Fastenal's Winona headquarters seeking comment weren't immediately returned.

While Fastenal is an old-fashioned company dealing in tangible goods used in construction and industry, Yglesias characterizes most of Slate's hot stock list as "depressing."

The rest of the list includes companies like Cabot Oil & Gas, El Paso Corporation (a gas pipeline company), MasterCard, Visa, and discount clothier Ross Stores.

Yglesias writes:

The way to get ahead over the past year has been to take advantage of the clothing-buying public's misery, to score a regulatory price coup, or to extract and burn finite fossil fuel resources without being made to properly pay for the negative externalities you generate. Here's hoping for a better year to come.


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