This column is for investors willing to take more risk and potentially receive more reward.  The stocks mentioned in this column are not recommended to buy or sell.  They're brought to your attention so you can investigate them further to determine if they fit your risk profile.  Most of the stocks will have less than $1 billion of market capitalization, have more volatility than other stocks, and oftentimes no earnings.  And some will have tremendous stories.

September 23, 2011 - American Vanguard Corporation (AVD-NYSE), through its subsidiaries, manufactures, develops, and markets specialty chemical products for agricultural and commercial uses, for crops, human, and animal health protection.

The hot button here is crops, ones like corn, wheat, cotton, and soybeans. They're in big demand worldwide. As global economies continue to prosper, people want more and better food and clothes. Farmers need to grow more to meet the demand. When they do, insecticides, fungicides, herbicides, growth regulators, and soil fumigants are part of the regimen for harvesting better and more crops. Currently, prices are rising on most commodities. Farmers are looking to American Vanguard products as a way to increase productivity to take advantage of them.

Earnings should hit record levels this year, finishing at 80 cents a share, exactly double last year's total. For 2012, expect 91 cents. Third quarter results reflect the ongoing upward trend. Expect 18 cents a share, up from 7 cents in last year's third period. For the last quarter, expectations are even higher: 21 cents vs 6 cents last year in the final period. If AVD delivers 80 cents for 2011, it will set a new record for earnings.

It's a combination of events that account for the success at American Vanguard: offering more products, especially extensions of existing ones; opening new geographic markets, and better cost cutting and efficiencies. The pay off: sales were up 54% in the second quarter to $80.4 million and earnings were 22 cents, 267% above last year's second quarter earnings.

Because of high demand, management has been able to get price hikes to stick. But raw material costs are going higher so margins aren't widening as much as might be expected. More volume, however, should lead to better efficiencies as plants have higher utilization rates.

Essential Numbers:
- Price to sales ratio: 1.17
- Price to Book: 1.82
- Operating margin: 11.35%
- Profit margin: 6.65%
- Return on equity: 11.05%
- Return on assets: 6.69%
- Revenues (last 12 months): $278.51 million
- Total cash: $9.96 million
- Cash per share: 36 cents
- Total debt: $70.08 million
- Total debt to equity: 39.44%
- Current ratio: 2.09
- Book value per share: $6.45
- Beta: .18
- 52 week change: +70.58%
- Total shares Outstanding: 27.69 million
- Float: 22.91 million
- Insiders own: 22.46%
- Institutions have: 67.8%
- Dividend: 10 cents
- Yield: .9%

AVD looks to be just starting. With world demand for basics growing, farmers need to maximize crop yields. AVD has the products to help.