Distributing replacement parts for factories and manufacturing plants generates

one-third of its revenues. An office-supply wholesale business that counts Office

Depot (ODP) as a customer generated sales of $1.7 billion. And electrical

components were 4% of revenues.

Typically, that diversity helps Genuine Parts weather economic declines. Also,

auto-parts sales historically do well when hard times keep drivers from trading in

their jalopies for new cars.

But the recession slowed down manufacturing production, which means less wear and

tear on factories and less demand for component parts.

Genuine Parts was slow to cut auto-parts prices last year to keep up with rivals.

Also, cash-strapped car owners are delaying repairs.

Still, one-third of the 250 million vehicles now on the road are six to 12 years

old, and provide the aftermarket industry's largest revenue source, says Soleil's

Ward.

With "cash for clunkers" replacing only 750,000 jalopies this year, "a lot of cars

ultimately still need repairs," says George Van Horn, an analyst with IBISworld.

Genuine Parts, meanwhile, has been cutting costs. The closing of General Motors'

and Chrysler's dealerships earlier this year will force more drivers to seek

repairs elsewhere.

Meanwhile, Nix sees revenues recovering along with the economy.

"We haven't given any guidance, but we certainly expect profits to be up next

year," he adds. "We have taken costs out of our business over the last year and

expect revenue growth in the auto-parts and office-supply divisions [next year]."

In 2010, auto-parts sales should climb 4% to $5.3 billion, says Gabelli's

Sponheimer.

Office-supply sales should climb 6%. Industrial sales should remain almost flat at

nearly $3 billion after falling in 2009.

"Genuine Parts is not a growth story," says Soleil's Ward. "To use a football term,

'it's three yards and a cloud of dust.'"

At 15 times projected earnings over the next four quarters, the stock trades at a

15% discount to the Standard & Poor's 500 index.

That is also well below the historical average.

Keith Hughes, an analyst at SunTrust Robinson Humphrey, sees the stock climbing in

the next 12 months to $42 a share, or 18.6 times his earnings estimates for 2010

$2.26 a share.

Based on the Street's more bullish outlook, the stock is worth 16.3 times earnings.

Of course, an economic recovery is not a sure thing.

A massive recovery in new-car demand will hamper sales. Rising gas prices could

keep more motorists off the road, reducing the need for repairs.

Still, even cautious analysts see profits growing next year. Cash flow remains

strong, and Nix seems confident of another dividend hike next year.

And the stock still has a few miles to drive.