Cost cuts are boosting their earnings

Article Excerpt

Most American manufacturers companies are struggling with rising costs for labor, healthcare, energy and raw materials like steel and plastics. The rising U.S. dollar also makes their products more expensive in foreign countries. However, these three well-managed firms are doing a good job of controlling their costs. That will help them survive today’s cross currents, and prosper all the more when the economy picks up again. We see all of them as buys, however, only two are suitable for conservative investors. GENUINE PARTS COMPANY $44 (New York symbol GPC; WSSF Rating: Average) distributes over 300,000 automotive replacement parts in the United States, Canada and Mexico, mainly through independent outlets. This business provides about half of its revenue. It also distributes industrial parts, office supplies and electrical equipment. In the three months ended September 30, 2005, earnings rose 12.5%, to $0.63 a share (total $110.9 million) from $0.56 a share ($97.9 million) a year earlier. Sales grew 10.6%, to $2.6 billion from $2.35 billion, mainly…

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