If you're like me, you're sick to death of people hyping SCP Pool (NASDAQ:POOL). Television, Internet, cocktail parties -- you can't escape the thousands of people who have ridden SCP Pool up more than 16 times in value since 1998.

What? You mean you're blissfully unaware of SCP Pool and its pool supply business? Are we going to the same parties? Because if I hear one more person tell me how dumb I was to have missed the rapid growth in swimming pool construction, I think I'm going to scream.

Anatomy of a sleepy winner
No, SCP Pool is not a "hot" stock. But it is proof positive that you don't need to find a hot, change-the-world technology to generate great investing returns.

It's one of the best-performing stocks of the past five years, but it's been in business, doing essentially the same thing, since 1993. It's an even better performer than truly "hot" stocks such as computer giant Dell (NASDAQ:DELL), logistics giant Expeditors International (NASDAQ:EXPD), homebuilder Ryland Homes (NYSE:RYL), and storage firm SanDisk (NASDAQ:SNDK). Each of these companies has generated massive returns for investors, along with lots of media coverage, yet the near-invisible SCP Pool did better.

That's not to say it's been a smooth ride for SCP Pool's investors. The stock market moves in funny ways -- particularly when it comes to obscure small caps. Investors at the firm have endured occasional rapid drops in share price, even as the company has generated some of the best returns of any company trading on the stock exchanges.

But never forget, a stock and a company are sometimes very different. Looking at a company's earnings shows that occasionally the two become unhinged.

Who could blame an investor for getting impatient? Underperformance can be tough to bounce back from, right? But SCP Pool's business continued to grow, and the stock has been a 16-bagger. A knockout.

Leave the stock; take the business
How would you feel if you had given up on the stock just as it was dropping at the end of 1998? Someone did just that. That's why when Fool co-founder Tom Gardner and I are analyzing small caps for Motley Fool Hidden Gems subscribers, we focus more on the business and less on the stock. The former provides the engine for long-term returns, while the latter is little more than the launching point.

We're late to SCP Pool (not to say that this company is finished with its staggering growth), but that's OK -- there are no called strikes in investing. Tom and I comb through the world's best small-cap companies each month looking for opportunities just like SCP Pool. They may not all be 16-baggers, but we're more than happy to be patient with companies that show the kind of trajectory SCP Pool did: a healthy, growing business, and a totally neglected stock.

For totally free, 30-day guest access to Hidden Gems and Bill and Tom's best small-cap stock ideas, click here.

This article was originally published on Jan. 26, 2006. It has been updated.

Bill Mann owns none of the companies mentioned in this article. Dell is a recommendation in both Inside Value and Stock Advisor. This message is sponsored by the Fool'sdisclosure policy.