LINAMAR CORP. $64 (Toronto symbol LNR; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 64.8 million; Market cap: $4.1 billion; Price-to-sales ratio: 1.1; Dividend yield: 0.6%; TSINetwork Rating: Average; www.linamar.com) gets around 80% of its revenue by making engines, transmissions and other precision-machined parts for automakers. It has 44 plants in North America, Europe and Asia.

The remaining 20% of Linamar’s revenue mainly comes from self-propelled, scissor-type elevating work platforms, which it sells under the Skyjack name. The company also makes other industrial machinery, such as parts for wind farms.

Pent-up car demand boosted results

Thanks to strong car demand after the recession, Linamar’s revenue jumped 114.5%, from $1.7 billion in 2009 to $3.6 billion in 2013. In addition, automakers are cutting their own costs by outsourcing more production to suppliers like Linamar.

The recession also prompted Linamar to cut jobs and close some plants. The resulting lower costs caused its earnings to soar from $0.02 a share (or a total of $1.1 million) in 2009 to $3.34 a share (or $216.1 million) in 2013.

A big part of Linamar’s recent growth has come from acquisitions it has made outside North America. Overseas markets now supply 30% of its revenue.

For example, in 2011 Linamar paid $30.1 million for three plants in France that make cylinder heads, engine blocks, gears and other parts for large engines and transmissions. Last year, the company paid $25.4 million for three German plants that make camshafts for various carmakers.

Tapping into Asia’s growth

Meanwhile, Linamar is aggressively expanding in Asia. The company is now building two plants in China, which will bring its total in that country to three. It has also leased a facility in India that should start making gears in 2015.

These new operations should help Linamar reach its goal of increasing its annual revenue to over $10 billion by 2020.

Linamar’s strong balance sheet will support its expansion plans. As of March 31, 2014, its long-term debt was $489.6 million, or a low 12% of its market cap. It also held cash of $144.5 million, or $2.23 a share.

The stock has more than doubled in the past year and now trades at 15.0 times Linamar’s projected 2014 earnings of $4.27 a share. That’s a high p/e ratio for a cyclical auto parts maker, but it’s still reasonable in light of Linamar’s strong international growth prospects. The $0.40 dividend yields 0.6%.

Linamar earns an upgrade

Linamar survived the 2008 financial crisis, plus the bankruptcies of GM and Chrysler, and emerged stronger than ever. We’ve upgraded its TSINetwork Rating from “Extra Risk” to “Average.”

Linamar is a buy.