Shareholders of General Electric (NYSE:GE) who were disillusioned following the announcement that Berkshire Hathaway (NYSE:BRK-A) (NYSE:BRK-B) has sold all of its remaining stake in the company should take heart. There's more than one fish in the investment sea. 

That's not to say GE isn't an exceptional company. History shows that it is. But for those looking to invest in the future of manufacturing and supply chain management, there's an even better alternative: Cognex Corp. (NASDAQ:CGNX).

Arrows on a stock chart overlaid on a digital map of the world.

Image Source: Getty Images.

Change is the only constant

Thomas Edison established what would one day become GE in the 1870s, and the company represented the epitome of American innovation for over a century. Then, under Jack Welch's watch from 1981 to 2001, GE made radical changes to its business structure, acquiring 338 businesses and product lines for $11.1 billion and selling 232 others for $5.9 billion. These moves, coupled with Welch's focus on shareholder returns, produced enviable results. GE shares rose more than 3,300% during Welch's tenure. The S&P 500 Index, in comparison, returned more than 800% over the same period.

But GE's success has also forged the chains of its current travails. General Electric has customers in approximately 180 countries and employs over 295,000 people globally. Its sheer size and the number of markets its services make above-average returns difficult, particularly in an increasingly fast-moving world.  

That brings me back to Cognex as an alternative. Not only does this company have a history of innovation and growth, but is considerably smaller than GE. It also has an ace up its sleeve: It stands poised to benefit from the rising demand for complex supply chain management.

Cognex is one of the leading manufacturers of machine vision technology. Since inception, its goal has been to create industrial-scale readers capable of reading and guaranteeing the quality of large quantities of goods as they're being processed. As you may imagine, Cognex has found its products in high demand in recent years. Our economy has become increasingly complex, and so have our supply chains.

And that's precisely why Cognex is such an intriguing investment today.

A 21st-century innovator

To get an idea of what "machine vision" is, you need to see it for yourself:

The benefits of Cognex's offerings to advanced manufacturers are obvious. Its machine-vision products are led by its "In-Sight" series of sensors and scanners. In the supply chain management industry, Cognex continues to see strong demand for its "DataMan" series, which gives customers the ability to accurately count massive quantities of goods passing through their facilities. And Cognex's offerings don't stop there. The company boasts an entire suite of barcode verifiers, mobile scanning terminals, and software solutions. 

Recent results have been exceptional. Cognex reported a second-quarter profit of $172.9 million, up 17% over the same period a year ago. Adjusted EPS was $0.56, up from $0.49 in the previous year's Q2. Management also raised guidance for Q3, stating that it expected profit to fall between $250 million and $260 million. Also of note, the company boasted a sky-high gross profit margin of 78.3% for the period.

Geographically, the company's factory automation division saw its strongest growth, not in North America but Asia. There, revenue grew 50% year over year. 

Management's enthusiasm was palpable during the Q2 conference call, but the company isn't resting on its laurels. It continues to invest in new product lines and artificial intelligence. As CEO Robert Willett noted in the company's conference call, Cognex is in the midst of integrating its recent ViDi Systems acquisition, which brought with it a team of artificial-intelligence experts. The acquisitions haven't stopped with ViDi, either. In recent months, the company has made not one but four acquisitions. These actions are likely to be critical in the years ahead, solidifying the company's position as the market begins to demand 3D vision (which gives customers the ability to calculate the size of an object) and automated facilities. 

Foolish bottom line

Cognex's customers, which include scores of the world's most respected companies, such as Apple, Eli Lilly, and Ford, rely on the company to make their manufacturing and supply chains more efficient. Its products are becoming increasingly needed as the marketplace demands faster and faster order fulfillment. For jaded GE shareholders, Cognex represents a fantastic alternative. Its history of both innovation and profitability would do Thomas Edison proud. At 41 times S&P Global Market Intelligence forward EPS estimates, the shares may seem expensive. But those same analysts expect the bottom line to almost double by fiscal 2021. This outlook compares strongly against GE's projections, which call for near-zero growth through the end of the decade.

Given its dominant position in an increasingly important sector, Cognex is a solid buy for anyone looking to invest in the future. 

10 stocks we like better than Cognex
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Cognex wasn't one of them! That's right -- they think these 10 stocks are even better buys.

Click here to learn about these picks!

*Stock Advisor returns as of August 1, 2017

Sean O'Reilly has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Apple, Berkshire Hathaway (B shares), Cognex, and Ford. The Motley Fool has a disclosure policy.