Fastenal Is A Proxy For The Industrial Economy

A relatively obscure company I have followed for some time is a well run outfit by the name of Fastenal. $10,000 invested in Fastenal in 1988 would have returned approximately $2 million at its peak earlier this year. Not too bad. The company has experienced very few weak periods. One was the 1990 recession and the other was the 1998 small cap crash. Fastenal Corporation and its wholly owned subsidiaries sell industrial and construction supplies on a wholesale and retail basis. According to corporate literature, customers who use Fastenal products include:

Construction
Road contractors
Manufacturers
Maintenance
Farmers
Truckers
Railroads
Mining
Governments
Schools

As of December 31, 2005, the company had 1,755 store sites located in the United States, Puerto Rico, Canada, Mexico, Singapore, China, and the Netherlands. If we are starting a new mid cycle bull market, why is Fastenal not leading us to new highs? Each equity market rally since this bull market began in 2003 has been led by Fastenal. A nonconfirmation from Fastenal does not necessarily mean anything. But, given its peak in May with the general equity markets and its relative weakness since, it does tell me the general tone of the market has changed.