On December 4^th I recommended a couple of small-cap consumer stocks because they had been passed over by investors who were seeking big returns in more glamorous companies. These two stocks have been good performers lately, so I want to give you an update on each.

The two companies I suggested you pick up on the cheap were National Presto Industries (NYSE: NPK) and Lancaster Colony (Nasdaq: LANC). I branded these two companies as 'boring stocks' and praised their attractiveness at that time. Here is what I wrote:

"I've been looking at a group of stocks that are about as flashy as a stack of corrugated cardboard boxes.  But don't let their appearance fool you, inside their drab exterior lies a steady flow of cash.  And investors who are willing to step back from the glitz of high-tech companies and the glamour of Wall Street's current darlings could be sitting on a boatload of profits in 2010 if they buy shares of boring stocks right now.

That's because this group of stocks has been overlooked as investors sought higher returns from faster moving stocks.  But after the 60% rise for stocks since March, investors are going to start buying more shares in companies that have underperformed, but still have compelling business models and shares trading at reasonable valuations.  Both large-caps and small-caps in this category should fare well, but I favor small-caps because they typically rise more than large caps."

At that point the Standard and Poor 500 had risen 63% from the March lows and investors had been piling into high risk stocks to grab quick gains as the market moved rapidly higher. But I felt investors would soon be buying shares of lower beta consumer stocks. Here's why, again from my previous article:

"Why am I so certain that these companies are likely to perform well? Because boring companies provide the staples that U.S. consumers will always need, and do so at a good value.  Soon investors will come around and start buying their stocks – and that will drive prices higher."

And higher prices have gone. If you bought shares in National Presto when I recommended it, you're now sitting on a nice gain of 20.4%. And Lancaster Colony shareholders are up 7.7%. Those returns are not to shabby considering the Russell 2000 is only up 2.5% over the same period.

Now I'm not just trying to pat myself on the back, although I do love it when we make healthy profits in small-cap stocks. But I want you to know that these two companies are likely to see shares move higher still. You'll find my original article on these two stocks at the Small Cap Investor Daily website by clicking here.

Despite the recent rise in its stock, National Presto still trades with a trailing P/E of 13.4 and a forward P/E of only 12. The company has an absolutely rock solid balance sheet with zero debt. Revenues and net income in 2008 grew by 6.5% and 14.4% respectively, and 2009 growth looks to be even greater. The company has a strong record on earnings as well, and in the third quarter of 2009 earnings per share increased 63% to $2.44 from $1.49 in the same quarter in 2008.

In the first nine months of 2009, earnings per share increased 57% to $5.97 from $3.80 during the same period of 2008. The company is expected to finish out the year strong and analysts have been increasing their earnings estimates recently. I'll be able to evaluate full year numbers together when National Presto reports on March 15^th.

But look for shares to trade higher before then. I expect this company could bring in over $530 million in sales and earnings per share of around $9.70 in 2010. In fact, a conservative earnings multiple of 14 puts shares at $135; 17% higher then the current share price. But given that other companies in the appliance sector trade with P/E multiples between 18 and 40, shares of National Presto could even move higher than $135 in 2010. 

As I wrote in December, "I don't find {this} performance boring at all.  It's time investors establish positions in the overlooked, and underappreciated, small-caps."

In fact, I was such a fan of National Presto that I recently included the company in my Top Stock Insights portfolio. This small-cap stock has a great history dating back to 1905 and over the last century has adapted to the times while earning shareholders money. You can read my full report on National Presto when you become a Top Stock Insights member, click here to sign up today.

If you didn't buy share in National Presto in December when I first recommended the stock, there is still time. I'll give you an update on Lancaster Colony tomorrow. But be sure to watch that stock today, it will report earnings at 10:00 a.m. and shares could move on the results.

If you want a little more help finding profitable stocks (boring or not) check out my Top Stock Insights advisory. It is a great complement to Small Cap Investor PRO. Plus you'll be among the first to receive research on my favorite companies. Just click here to get started with Top Stock Insights today. And click here to get started with Small Cap Investor PRO if you're not already a member.

I hope you were able to profit from these small-cap investment recommendations. If so, write to me and tell me your success story. My address is: editorial@smallcapinvestor.com.