I recently did a stock screen to find the number of U.S. stocks trading over $200. Out of 5,910 stocks, just 19 fit the bill. Among the list of companies at the time were Berkshire Hathaway (NYSE:BRK-A), Google (Nasdaq:GOOG) and Priceline.com (Nasdaq:PCLN).

However, among some of America's elite is Atrion Corporation (Nasdaq:ATRI), a Texas-based micro cap that produces niche medical products. Atrion, along with Biglari Holdings (NYSE:BH), are the only micro-caps among the group of 19 stocks. Atrion will give any of these big companies a run for their money.

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Always Makes Money

I went back as far as 1990 and on only one occasion, 1997, did Atrion generate an operating loss. Even then, it would have made $1.5 million on an operating basis if the $4.8 million impairment loss for some of its patents is excluded. This is where it gets tricky. Atrion used to be known as AlaTenn Resources Inc. and operated natural gas pipelines.

In 1994, it began acquiring medical products businesses. First, it acquired Atrion Medical Products in April 1994, then it bought Halkey-Roberts in May 1996, and finally, in January 1998, it purchased QMI Medical, the cardiovascular and intravenous fluid division of Quest Medical Inc.

At the same time, it sold all of its natural gas businesses for about $38.2 million in 1997. From 1998 onward, it's been strictly a medical products business, making money for 14 straight years. In that time, revenues have grown from $30.3 million at the end of 1997 to an estimated $119 million in 2011, or 10.3% compounded annually.

Not a huge grower, its niche position allows it to make good money. In 1997, as mentioned previously, it lost $2 million on continuing operations. In 2011, operating income will be around $38 million with earnings per share of $12.84.(To know more about income statements, read Understanding The Income Statement.)

Lots of Cash

Generating more than $20 million in free cash flow annually, Atrion currently has $19.45 in cash per share. The odds of it not being able to pay its annual dividend of $1.98 is slim to none. In the past five years, it's increased its quarterly dividend at least once per annum, averaging just under 20% for each increase.

In 2010, shareholders received the motherlode, as it paid not one, but two special dividends. In January 2010, it paid a $6 special dividend and then, in time for Christmas, it paid a second $3 special dividend. That's $9 in cash that went out the door and it barely blinked finishing 2010 with $41.7 million in cash and investments.

As of the third quarter ended Sept. 30, 2011, its level of cash and investments was up 27% from the end of 2010 to $52.7 million. Considering the two special dividends amounted to an expense of $18 million in cash, it could easily afford to do the same thing in 2012. I doubt it will, but it could.

The Business Itself

Atrion generates revenue from four product lines: Fluid Delivery, Cardiovascular, Ophthalmology and Other. The fluid delivery and cardiovascular products account for approximately two-thirds of its overall revenue.

The most consistent product line in terms of revenue growth is its fluid delivery valves, which have seen revenue increases in each of the last six fiscal years and 2011 appears be no different. It's not flashy about what it does and that's what's so attractive about it. Proponents of "Made in America" policies will like the fact its products are produced exclusively in Florida, Alabama and Texas, with no offshore production.

With the exception of Novartis (NYSE:NVS), which accounts for 14% of its sales, no other organization represents more than 10% of revenue. It's sufficiently diversified, both in terms of product and customer mix. Most importantly, Atrion's revenues outside of the U.S. and Canada represent almost a quarter of its overall business and are rising at a moderate pace. Overall, its business appears very sound.

The Bottom Line

Atrion seems to do everything well. In the third quarter, it repurchased 8,000 of its shares at an average price of $189.12 a share. As of January 18, its stock is up 27% since the buyback. Over the past decade it's up 21.1% annually compared to 3.5% for the S&P 500. Hold this stock for 20 years and you might just be looking at a future mid cap. Slow and steady wins the race. (For additional reading, check out 5 Must-Have Metrics For Value Investors.)

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At the time of writing, Will Ashworth did not own shares in any of the companies mentioned in this article.