If I told you there is a stock that more than doubled during the last recession, would you be interested? If I told you it also doubled during the recent bull market – from 2003 to last year – would you would be even more interested?

Well, UST Incorporated (UST), formerly known as U.S. Tobacco, did just that.

The company has two product lines: smokeless tobacco and wine. Their smokeless tobaccos include Skoal and Copenhagen. Their wines include Chateau Ste. Michelle, Columbia Crest, and Domaine Ste. Michelle.

UST has a profit margin of 26.7 percent and an operating margin of 46 percent. The return on assets is a robust 38.6 percent. In the most recent quarter, UST showed a year over year revenue growth of 13.1 percent, and is expected to show growth of 9.3 percent in the current quarter.

In addition to this solid fundamental footing, UST boasts a 4.3 percent dividend. And dividend-paying stocks usually hold up much better in a bear market than non-dividend-paying stocks.

Despite all this, Wall Street is far from enthusiastic about the stock. But that’s not a bad thing. Of the 10 analysts following UST, five rate it a “buy,” two rate it a “hold,” and three rate it a “sell.” This leaves plenty of room for them to upgrade the stock – and when they do, the stock will move higher.

Another bit of negativity that will add fuel to the fire of any UST rally is that its short interest ratio is a healthy 4.9, with over 7.5 million shares sold short.

Given the current state of our economy, UST is a good stock to have in your portfolio. Even if we manage to stay out of a recession, UST looks poised to move higher. If we slip into a recession, it could perform even better.

[Ed. Note: Rick Pendergraft is a professional trader and market analyst. In Rick’s new investment service, he reveals how you can make hundreds – even thousands – of dollars just by playing a simple game of “guess the pattern.”]

Inspired by his high school economics teacher, Rick Pendergraft fell in love with the markets at an early age. He entered his first investing competition at 17, and opened his first brokerage account before he finished college. At the age of 23, on the third options trade he had ever placed, Rick turned $1,800 into $22,000 in less than a week, when the company he bought became the target of a takeover. He admits it was a stroke of luck, but it was a memorable education as to the leverage that options can provide.
After a ten year career in banking, Rick decided to pursue trading full-time. To get his foot in the door, he started out in the sales department at Schaeffer’s Investment Research. It was not long before his talent was recognized and he was invited to apprentice under Bernie Schaeffer, one of the top options traders in the world. Rick thrived in his new position and twice received the award for “Top Trader.”Rick has developed a loyal following of readers who are grateful for his timely warnings and profitable advice. He is widely recognized as a market expert and has been frequently quoted by Reuters, BusinessWeek, Forbes, USA Today, the New York Times, and the Washington Post. Rick’s primary focus is on identifying short and intermediate term rising and falling trends in the major market sectors. His analysis is based on technical factors along with indicators of market sentimentRick lives near Delray Beach, FL with his wife and three children.