NN, Inc. (NNBR) has been able to produce impressive earnings growth in a very tough environment. The company has surprised and beaten analyst estimates in each of the last three quarters, and the analyst community is projecting 16% earnings growth in the next-year period.

NN, Inc. manufactures precision bearing components for bearing manufacturers worldwide. The company was founded in 1980, has a market cap of $225 million and is headquartered in Johnson City, Tennessee.

Second-Quarter Results

NN, Inc’s share price has logged impressive gains in 2008, no doubt helped by the company strong second-quarter results, reported on July 31.

Revenue was up 13.9% to $122.2 million. Net income totaled $9.2 million, a big turn-around from a loss of $1.4 million in the same period last year. This produced adjusted earnings of 31 cents per share, ahead of analyst estimates of 26 cents per share.

This was the third time in the last three quarters that NNBR has surprised and beaten analyst estimates, a demonstration of consistent earnings power in a very tough environment.

Guidance and Estimates

During the news release CEO Roderick Baty delivered some bullish comments about the company’s outlook, saying that, “We anticipate overall good levels of industrial end market demand in North American to continue for the remainder of 2008.”

Baty did say that the company will suffer from depressed automotive sales in multiple international regions, but went on to confirm full-year earnings guidance between 90 and 95 cents per share.

Analysts are a little more bullish, projecting full-year earnings of $1.08 per share. The next-year estimate is pegged at $1.25 per share, a 16% earnings growth projection.

Valuations

Based on the current-year estimate, this stock is trading at a slight premium to the overall market, carrying a forward P/E multiple of 13X.

The Chart

Shares of NNBR have had a great year, climbing from just over $9 per share to a recent high over $17. More recently, this stock has pulled back and taken a breather and retreated into lower territory. But based upon the bullish projection from the analysts and this company’s ability to meet expectations, this stock looks well positioned for more gains.

Content Courtesy: Zacks Investment Research

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