Slow and steady may win the race, but it's also occasionally true that if you snooze, you lose. I've been snoozing on Laidlaw (NYSE:LI) for a while now. Taking my eye off this particular ball for the last year has cost me more than a double in the stock price.

This operator of both school buses and Greyhound buses has made some significant progress restructuring its business, and the market seems to be noticing that. Having sold its health-care assets earlier in the year, Laidlaw has paid down a big chunk of debt and moved to restructure the rest of it.

Nevertheless, results for the third quarter were pretty soporific. Revenue was basically flat, operating income was down about 16%, and income from continuing operations eased off by 5%.

Though the company did not include a balance sheet or cash flow statement with its results, it would appear that cash flow is going all right. EBITDA (earnings before interest, taxes, depreciation, and amortization, which really isn't a proxy for cash flow) was basically flat with the prior year at $133 million. What's more, the board is apparently confident enough in the state of the business that it has initiated a $0.15-per-share quarterly dividend.

Looking ahead, this would seem to be a story more of leverage and income than growth. Laidlaw's school bus business is stable and rather lucrative from a cash flow perspective. In the case of Greyhound, I wouldn't expect much revenue growth, but there appear to be ample opportunities to improve margins there.

If management can keep the wheels from falling off the school bus business and simultaneously drive some improvement in Greyhound, that would free up even more cash to deal with debt and spin off to shareholders.

All that said, it seems like continued improvement is already expected. Analysts aren't looking for any revenue growth, but they are looking for Laidlaw's EPS to improve from $0.53 in fiscal 2004 to an estimate of $0.70 for fiscal 2005 and $1.14 for fiscal 2006.

Turnarounds can be great opportunities for investors, but they require an above-average commitment to due diligence. If Laidlaw can drive better profitability, there's more room to run. But if the company finds itself hitting a self-improvement ceiling, the stock may end up idling on the side of the road.

Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).