While Hidden Gems standouts such as Faro Technologies (NASDAQ:FARO) and Middleby (NASDAQ:MIDD) tend to hog the limelight, sleeper picks from guests, such as Saucony (NASDAQ:SCNYA, SCNYB), have quietly gathered fans.

Rex Moore's stealth success story, Portfolio Recovery Associates (NASDAQ:PRAA), is another one of these. Like others, my wife instantly saw the allure of its business niche: buying consumer debt for pennies on the dollar, then collecting on it and -- hopefully -- pulling in more pennies than were paid out.

"People are idiots," she said, perusing yet another article about American consumer debt, and she promptly added a position in PRAA to her IRA.

That turned out to be a good move: The stock has appreciated about 17% since June. And Portfolio Recovery is up another 10% this morning on news of an acquisition. The firm will dole out $14 million in a cash and stock deal to welcome IGS Nevada to the fold. The release describes IGS as an "asset location" company. The phone book calls it a private investigation firm. You say "potato." I say "spud."

IGS's main business is described as tracing deadbeats in the prime and subprime auto lending market. Its management will remain and continue to pilot the firm.

The benefits to Portfolio Recovery look to be twofold. First, management is looking for an earnings trickle-down of $0.13-0.17 per share from the acquisition for fiscal 2005. Perhaps more importantly, the ability to find debt-skippers of all kinds means this could be exactly the kind of synergistic enterprise that would help Portfolio Recovery improve where it counts: increasing its collections.

If management's predictions come true, the flat $0.15 per share would pay for the acquisition in about six years. And it leaves the firm with $30 million in cash on the balance sheet. While today's enthusiasm looks justified, investors should tune in to the conference call later this month to get a better picture of exactly what this purchase will mean.

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Seth Jayson likes to keep his debt low and out of the public marketplace. At the time of publication, he had long positions in Portfolio Recovery and Faro Technologies. View his stock holdings and Fool profile here . Fool rules are here .