The Misfits: Transcat, Inc. (TRNS)

A corporate change has transformed a less-than-great distributor into something else entirely.

The Young Scientist, Herbert Butler, 1919, oil on canvas

I didn’t realize what I was getting into when I started looking at Transcat (NASDAQ: TRNS). I thought I would find another niche distributor with a stellar track record of returns that led to its stock walloping the market over the long term.

Transcat isn’t really a distributor. At least, that isn’t why it has generated those spectacular returns. Instead, the company has been on a 12-year path to transform into something completely different than the market appears to like a lot.

Here’s a look at this small-cap distributor (but not really a distributor) and how this strategic change has led to such impressive results.

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