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The strength of the global economic recovery is evident in the manufacturers. Innophos Holdings Inc. (IPHS - Snapshot Report), which produces specialty phosphates, recently reported fourth quarter sales that jumped 31%. This Zacks #1 Rank (strong buy) is cheap, trading at just 10.9.

Innophos Holdings manufactures specialty phosphates. Operating as a holding company, it offers products to customers for use in food and beverages, pharmaceuticals and other industrial applications.

The company operates 7 manufacturing facilities in the U.S., Canada and Mexico.

Innophos Beat By 17% in the Fourth Quarter

On Feb 7, Innophos reported its fourth quarter results and surprised on the Zacks Consensus Estimate by 13 cents. Earnings per share were 89 cents compared to the consensus of 76 cents. It made just 23 cents in the fourth quarter of 2009.

Sales jumped in the fourth quarter by 31% to $192 million as volumes grew 32%. Specialty Phosphates saw a big turnaround, as sales rose 11% to $161 million as volumes climbed 16%. Prices, however, were 5% below the prior year.

Demand continues to improve in the US and Canada Specialty Phosphates business. Specialty Phosphate volume growth continued in the double digits for the year, despite tough prior year comparisons.

Growth in Mexico was also a factor in the quarter and the full year results. Specialty Phosphate export sales rose to 18% in 2010 from 12% of sales in 2009. The company expects Mexican growth to continue to be a contributing factor.

Zacks Consensus Estimates Soar

The company expects strong demand to continue into 2011. Analysts are equally as bullish about the new year. Since the earnings results, all 3 estimates for 2011 have been revised higher.

The 2011 Zacks Consensus Estimate has jumped 17.4% to $3.84 from $3.27 over the last week.

That is earnings growth of 32.5% as the company made just $2.90 per share in 2009.

Double Digit Earnings Growth Yet Still a Value

Innophos is one of those rare stocks that has both value and growth characteristics. It has a PEG ratio of just 0.8, which is below the value benchmark of 1.0.

The company also has a stellar return on equity (ROE) of 16.1%.

Shares at All-Time Highs

Innophos shares have only been trading since 2007. But recently, shares jumped to new all-time highs.

Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor in charge of the market-beating Zacks Value Trader service. You can follow her at twitter.com/traceyryniec.

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