So, investors? Did you take my advice to buy Navistar (NYSE:NAV) last month?

Oh. Hmm. I see you did not. Over the two weeks since I argued in “Navistar, Rising Star?“ that the company formerly known as International Harvester was worth a buy, the stock continued to plummet -- all the way up until the moment that Navistar reported "Record Third Quarter Earnings" and raised guidance last night.

Imagine that
Yep. And in response, the 7% downdraft of the past two weeks was erased in an instant, as Navistar's stock has surged 9% since the announcement. (My only regret: Despite spying an obvious bargain, I forgot to rate the stock an "outperform" in CAPS.) Well, no time for lamentation. Let's proceed right on to the news. So far this year, Navistar has defied the "weak truck market in North America," achieving:

  • 20% sales growth through the first three quarters of the year ($10.9 billion in all)
  • 7.7% operating margins from its manufacturing segment (better than twice last year's number)
  • and $5.92 per diluted share in net profit (as compared to a net loss last year).

And that's not all
As I mentioned above, in addition to posting superb results year-to-date, Navistar upped its guidance for the rest of this year. Management predicts further improvements in profitability through "strategic alliances."

Now, I hesitate to guess with whom Navistar aims to tie up next; it already cooperates with parties both expected, such as German trucker Man AG, and entirely unexpected, such as Qualcomm (NASDAQ:QCOM). Meanwhile, it sells to both Ford (NYSE:F) and GM (NYSE:GM), Heartland Express (NASDAQ:HTLD) ... and the U.S. Marine Corps (where it's been grabbing armored-vehicle market share from General Dynamics (NYSE:GD) and Force Protection (NASDAQ:FRPT) like Patton on the march).

But whatever Navistar's got up its sleeve in the way of new synergies, management expects it to pay off big-time. The latest projection is for profits to range between $6.35 and $7.45 by year-end -- a whopping 38% hike over previous projections, at the midpoint of their respective ranges.

Too late to buy?
After a 9% run-up, that's a fair question. But consider: Even at $60 a stub, Navistar sells for less than 10 times the midpoint of this year's projected profits. And analysts (albeit only two of them) suggest it could keep on growing as fast as 27% long-term.

To me, that seems a rather optimistic target for a truck maker. But if Navistar grows even half as fast as the professionals seem to expect, it makes for a sizeable margin of safety at today's price.

Before it became a star, Navistar lived in the black hole of NYSE non-compliance. Read all about it:

Fool contributor Rich Smith does not own shares of any company named above. Why do we tell you this? Because The Motley Fool has a disclosure policy.