Stoke-based valves-maker Goodwin, whose niche products are helping the power generation industry cut its carbon footprint, hides its light under a bushel.

Flagged up here in 2005 as a minnow worth following at 537.5p, Goodwin enjoyed a stellar share price performance last year, gushing north from 750p to 1,000p a share. Interim figures to the end of October, issued just before Christmas, made good reading, revealing a 54% profits push to �4.37m on 15% growth at the top line to �35m. Order books at all Goodwin companies apparently remain buoyant and management sees no second-half let up in demand.

The group’s steel castings business continues to snare ‘multi-million dollar’ orders for valves and components used in the electrical power generation industries of the US as well as China and India. Meanwhile, Goodwin International expects to bag record orders ‘yet again’ this year on the back of buoyant demand from the global oil, gas and LNG industries. Elsewhere, the refractory engineering division, with operations in the UK, China, Thailand and India, continues to expand and management sees continued growth in sales and profits at internet business Internet Central.

Based on rising gross margins, modest debt levels and an exciting financial track record, investors able to buy Goodwin (the free float is limited with the Goodwin family speaking for the majority of the shares) ought to do so, given the historic price-to-earnings (p/e) ratio of 15.7, modest given last year’s market valuation gains. Buy.

Growth Company Investor subscribers have full access to all our AIM and small-cap share recommendations. To subscribe today with a half-price offer, and gain immediate access to all the recommendations, click here.