Balchem Corp (BCPC-Q)

Used by a lot of companies as one small component of products. High cost and high risk to switching. If we are going into a recession, watch for these chemical industrial names to get hit first. Not a problem to own, or add, now.

One of the best performers on the S&P in the past 30 years. This is asset-lite, so it can pay the dividend, buyback shares or buy companies. They grow organically and through acquisitions.  They grow their free cash over time. Flies under the radar.

(BNN had the date as Nov 28/13, but I show Nov 8/13.) (A Top Pick Nov 8/13. Down 9.15%.) Made an acquisition that is going to be accretive to their earnings and the stock shot up to $67, but that was because it hit 1.5 billion in market and all the ETFs had to pile in. It has settled back down again. Make choline chloride, a vitamin B supplement, which goes into our drinks and also helps increase yield for dairy cows. Also used for fracing in the oil/gas industry.

(He recommends you take a half position only because these Top Picks are trading at multiples that are higher than average, but are still attractive as long-term investments.) A specialties chemical firm. Make choline chloride, which goes into feedstock for cattle and chickens. Also, chemicals for foodstuffs, as well as improving milk content in dairy cows. Free cash flow has consistently risen for the last decade. Dividends have been growing at a 20% clip. Yield is very small so he has been buying it for his clients’ grandchildren. This is one you can buy and hold for a long period of time.