"Under the Radar" uncovers little-known companies worthy of investors' consideration. Browse this week's picks.

COLUMBUS, Ohio ( TheStreet) -- Lancaster Colony ( LANC), based in Columbus, Ohio, has an eclectic product line-up: specialty foods, glassware and candles. Its businesses fared well during fiscal 2009, which ended June 30. Sales grew 7.2% and profit surged 137%.

The company swung to a fiscal fourth-quarter profit of $28 million, or $1.10 a share, from a loss of $2.6 million, or 9 cents a share, a year earlier. Last year's quarterly results were hampered by a $13 million loss from the sale of automotive operations.

Lancaster's gross margin rose from 18% to 28%, and its operating margin jumped from 8% to 17%. Margins benefited from cost-cutting and organic sales growth. The cost of sales fell 6% to $188 million as revenue increased 7% to $253 million.

Its specialty foods segment sells a range of products, including salad dressings, dips and even a line of caviar. Food accounted for about 90% of quarterly sales. Glassware and candles contributed the rest. Food generated $47 million of operating profit, while glassware and candles suffered a loss of $875,000.

Since the year-earlier quarter, Lancaster's balance sheet has markedly improved. The company paid off the entirety of its $55 million long-term debt and doubled its cash balance to $38 million. We give Lancaster a financial-strength score of 9.4 out of 10, higher than the "buy"-list average of 7.

The shares have rallied 51% this year, more than major U.S. indices. But at a trailing price-to-earnings ratio of 16 and a forward P/E ratio of 14, Lancaster is still cheap compared with the overall market and packaged-food peers. The stock trades at 3.5 times book value.

If you liked this article you might like

Thirsty for Dividends and Hungry for Rising Payouts? Feast on These Names

20 Mid-Cap Dividend Growers Are Blips on My Tracking Radar

Lancaster Colony (LANC) Showing Signs Of Being Strong And Under The Radar

3 Stocks With Upcoming Ex-Dividend Dates: CIK, LANC, CNI

New Lifetime High Today: Lancaster Colony (LANC)