In his latest Forbes column, Jim Oberweis talks about how he goes about finding small-cap stocks with niche businesses for his portfolio.

“To find tomorrow’s winners, my team and I start with the numbers,” he says. “Is the company organically increasing sales at a rapid rate? How about earnings per share? Niche businesses with innovative products should be growing by at least 20% annually (we prefer 30%). They should be profitable and have ­expanding operating margins. As a general rule a double-digit net operating margin screams ‘great business.'”

Oberweis says he then spends a lot of time “trying to understand the threats of new competition or alternative products or services. The beauty of niche-market leaders is that they are too entrenched for upstarts to dislodge and too small for the big companies to care.” He offers a look at four niches that are being dominated by small-cap growth stocks, and highlights a stock from each one. Among them: Amerigon, which specializes in heated and cooled seats for cars.