This column was originally published on RealMoney on Oct. 13 at 10:18 a.m. EDT. It's being republished as a bonus for TheStreet.com readers.

Even when the market is in the tank, there are always a few stocks making new highs. Lately, they have been scarce, but the ones that are making the trek are an interesting bunch.

One that just has to jump out at you is Johnson Controls ( JCI), a $12 billion maker of car parts. If you believed that auto suppliers would be reeling in the wake of the bankruptcy of group leader Delphi ( DPHIQ), you'd be right. Most are. So how has this one bucked the trend, shooting to an all-time high during Wednesday's session?

It turns out that investors are excited about Johnson Controls because it has become an island of stability in a very rough sea. It's not just because its building control system business has been pretty good, balancing out the horror show of the U.S. auto business. It's in part because Johnson has been successfully innovating -- it announced this week that it had received an order to develop a hybrid battery for an unnamed European automaker -- and acquiring to eke out marginal new growth.

The touchstone for the company's advance was an analyst meeting this week that wasn't nearly as scary as many had feared. Johnson revealed that its three-year automotive backlog would come in a touch below guidance -- but it was not nearly as bad as expected. Indeed, it was good enough to make investors believe that Johnson could drive some strong revenue and earnings growth through 2007 and use the improved cash flow to pay off debt, boost its dividend and maybe make more acquisitions.

If the company can do all that it promised, it could even be accorded a price-to-earnings multiple more suited to a decent midsized conglomerate than a muddled auto-parts supplier. The idea among bulls is that if it's seen that Johnson could haul in more than $6 a share in 2007 and squeak out just a 13 multiple, next year the stock could start to motor into the $70s and beyond.

Dividends are also important in a low-growth environment, and you may be surprised to learn how much fund managers would like to see companies like Johnson Controls keep up their annual 10% to 12% dividend growth. The company historically has bumped up its divvy in November, so a move to $1.12 or so from $1 may be around the corner.

Back in August, the company announced that it would further diversify away from the automakers by buying York International ( YRK), a global manufacturer of heating, ventilation and air conditioning equipment, for $3.2 billion. Although investors sometimes punish a company for being too acquisitive, in this case they have applauded and have indicated that they would welcome more purchases either in the controls or battery business.

Now, about those batteries: As you have probably noticed, gas-electric hybrid cars are one of the few bright spots in the auto industry this year, and they are delivering a lot of buzz and sales to Toyota ( TM). The new European contract that Johnson announced would be its first for a hybrid. Some investors expressed disappointment that the batteries will be made of nickel metal hydride instead of next-generation lithium ion. Regardless, it's a start.

According to a CS First Boston analyst, the new vehicle is a new luxury model, not a restyled existing model, slated for production in 2009. That means it would be low volume, according to the analyst, but Johnson's experience, if successful, should lead to new battery business on higher-volume hybrid cars and trucks.

In summary, in Johnson you have a fairly cheap, dividend-paying old-economy company that has announced expectations for revenue growth around 10% and earnings growth of around 15%. Margins are under control, debt is under control, technology investments are working, and it is feeling good about its ability to find growth-accretive acquisitions. During a gloomy week for so many other industrials, the market has seemed to find comfort in these stalwart traits of Johnson's.

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Jon Markman, writer of TheStreet.com Value Investor, is the senior investment strategist and portfolio manager at Greenbook Investment Management, a division of Greenbook Financial Services. Separately, he is publisher of StockTactics Advisor, an independent weekly investment research service. While Markman cannot provide personalized investment advice or recommendations, he appreciates your feedback; click here to send him an email.

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