Investors in Donaldson (NYSE:DCI) took a breath of fresh air earlier this week as they read over its quarterly results. Not that they had anything to be worried about -- this company has grown earnings for each of the past 15 years.

Looking over the report, the engine and industrial filter businesses are doing well; sales in both segments were up 11%. After factoring out currency gains, total sales increased 9% over last year's third quarter. Net income only grew 4% year over year, excluding currency gains, because of a higher tax rate. Donaldson also announced that it had purchased 4.4% of its outstanding shares during the last three quarters.

This share repurchase isn't out of the ordinary. Donaldson is like the straight-A student of earnings reports, reducing outstanding shares for each of the past 15 years even as it grew earnings and EPS. Over that period, Donaldson has rewarded shareholders with a 21% average annual return.

I would customarily jump in here and say "I've found something -- Donaldson's a fake!" But I really haven't. The company does dilute shares by issuing options and doesn't expense them. But this dilution is fairly moderate, and Donaldson definitely isn't alone in this crime. Its competitors, Cummins (NYSE:CMI) and Pall (NYSE:PLL), are formidable, but Donaldson maintains market leadership in many of its divisions.

What about revenues -- do they all come from a few unnamed companies in South America? Nope, although the company's international business now represents over half of total sales. GE (NYSE:GE) and Caterpillar (NYSE:CAT), a couple of very well-known customers, have accounted for more than 10% of revenues in some years. But selling core products to stable companies is never too large a risk.

Am I telling you to run out and buy shares? Not exactly. Wall Street has branded Donaldson an overachiever and rewarded it with a P/E of 25. This isn't overvalued, but once option expenses are figured in, the company will need to maintain its growth rate for several years to provide investors with solid returns. However, with its past performance and current positioning in profitable filter segments, Donaldson's prospects bode well.

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Fool contributor Matt Thurmond owns no shares in any company mentioned above.