I am working on presenting Fastenal at our next investment club meeting.  I've looked at data from Valueline, S & P, Manifest, Morning Star and Take Stock.  It looks like last year, the stock was held in many portfolios because it was a quality growth company.  I haven't seen anything posted in 2008.  Because the price is at the 52 week low, my upside/downside ratio is huge - 47.5 to 1. 

I've looked at the competitors in the industry, Grainger (GWW), MSC Indus. Direct (MSM), and Anixter Inter (AXE).  Strangely none of these other quality companies are followed in the StockCentral community.  Granger looks like a Value stock with their high dividends.  AXE and MSM also look like fine stocks, and most are in their 52 week low price range.  These two have debt, which Fastenal has none. 

I would appreciate some community input on these stocks.  Unfortunately, fasteners are not my area of expertise, unless you count buttons and even then, I'm only about 97% capable.

Jeanie Krieger
Sacramento, CA

Hi Jeannie, I would bet that most stocks are sitting near their 52 week lows now and may be heading lower for the near term. Mostly on market uncertainty where the economy is going. I have looked at FAST when I was in my club and liked everything I saw. Again we see that even a bad market can hurt good stocks. I have attached my SSG in ITK format so I could send the notes. If others want it in SSG format, ask. It is a buy currently with a 4.7 UD ratio. But patience is a virtue in this enviroment.

Today, 1/14/08,  the market is up 1.3% and FAST is up 3.7%. I would guess that trend would be even higher when the market recovers. Past performers seem to get a benefit when things start going well.

One thing I always note is that when I see a UD of over 10 / 1 I am not realistically predicting the downside

Hi Jeannie; Couple of places to look. go to the SC tools tab/research links and type in FAST and you will scroll down to MSN key ratios, (Yahoo has this also). That will take you to this link

http://moneycentral.msn.com/investor/invsub/results/compare.asp?Page=PriceRatios&Symbol=FAST

Reuter has this http://stocks.us.reuters.com/stocks/ratios.asp?rpc=66&symbol=fast 

S&P has a TTM PE of 19.6. The historical average of the S&P over a lengthier period I believe I have read is in the mid to high teens range. So I guess 17 is 19's conservative cousin. You will also note that Fast has a premium tied to it compared to the industry and S&P. PE's are like ladders, the higher they are the farther one has to fall. However, it also shows FAST is a well respected company and has merited this premium for some time. Look at the PMG chart and you will see floors, (support) and ceilings, (resistance). where the PE gets to high it will usually get corrected by the market, and times when others usually buy in when it trades near it's historical lows. You're familiar with the term from analysts that they are downgrading a stock based on valuation, that is the ceiling where the reward doesn't outweigh the risk.

With the eratic trading  going on right now doing research is probably the best way to spend time. From a high of 14,000 in the Dow to todays close of 12,160 we nearing what is considered a bear market correction, (what a shock)! Historically that is 20% we are about at 15% drop at this time. So while it may not be time to back up the truck, it is definitely time to check the tires, clean the windshield and get a list of historically good companies that come out of market slowdowns stable or stronger.

Am now doing a FAST study for my club, a bit late on the bandwagon, we missed the nice price dip into the 30s, but it's still below its 2007 high. 

Any updated thoughts on the stock since the January comments?