The manufacturing sector is not exactly what I would call a booming place to be right now. Although the Purchasing Managers Index has shown growth in 31 straight months, not everything is nearly as peachy as it could be.

Aluminum producer Alcoa (NYSE: AA) has struggled with weakened demand and falling aluminum prices. Similarly, AK Steel (NYSE: AKS), which produces flat-rolled carbon, stainless steel, and electrical steel primarily for the U.S. market, has widely missed analysts' EPS estimates in the past three quarters. The same could be said for myriad U.S. steel producers.

Now more than ever, investors are having to look internationally for growth in the manufacturing sector -- and I think I've got just the recipe for success.

Grupo Simec (AMEX: SIM), a Mexican-based steel producer that produces special bar-quality steel commonly used in the automotive and nonresidential construction industry, is once again piquing my interest.

The U.S. residential manufacturing picture may be bleak, but the automotive industry seems to be prospering just fine. In February, General Motors (NYSE: GM) reported a 1.1% rise in total sales over the year-ago period while Ford (NYSE: F) sales spiked 14.3%. If we include all manufacturers, total car sales increased in February in the U.S. by 23.9% over last year. It's hard to argue against growth like that, and it's tough to ignore Grupo Simec, a company whose steel products are used to make axles, hubs, and crankshafts for cars and light trucks.

One of the only automotive segments not doing as well is heavy-duty trucks, which usually respond poorly to rising gasoline prices. Luckily, Grupo Simec does not supply parts to this segment.

Grupo Simec's 2011 full-year results, released on Valentine's Day, confirm just how far the company has come since I first recommended adding it to your watchlist 15 months ago. Total sales rose 19%, operating income jumped 123%, and the company kept its costs under control with operating expenses falling 46%. Most importantly, it proved that it can grow its businesses domestically. Mexico's GDP growth has fluctuated between 0.4% and 2% for the past two years, yet Grupo Simec, which derives 47% of its business from Mexico, was able to grow sales by 26% in the country the past year.

This company could represent one screaming steal of a deal in the steel sector, given that it's trading at just 11 times forward earnings and is currently priced slightly below its book value. It does lack a dividend, which would be a nice addition, considering that Grupo Simec has been profitable in all but one year over the past decade. But we can't always get what we want, can we?

Since making a CAPScall of outperform on Grupo Simec, I am up 14% and I expect that momentum to continue. Do yourself a favor and add Grupo Simec to your free and personalized watchlist and consider making your call as to what the future holds for this specialized steel company.

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