The best-performing stock newsletter over the past year is finding value in some areas of the market that have been hit by fear during the recent downturn.

The Linde Equity Report — up more than 64% in the past 12 months, more than quadrupling the broader market’s gains — has nine current “buy” recommendations, reports MarketWatch’s Peter Brimelow. One comes from the oil services industry (which has been dogged by the Gulf oil spill), and four others come China or the travel industry, two areas that have been hurt by fears of another economic downturn.

Linde, which has returned an average of 8.4% per year in the nine years Hulbert Financial Digest has tracked it (vs. 2.1% for the Wilshire 5000), uses a “rifle-shot” approach, targeting a limited number of stocks and staying fully invested at all times.

The strategy the letter uses is “austerely fundamentalist,” Brimelow says. The letter “strives to discover stocks with strong growth rates, high gross margins, expanding product demand, seasoned management, and a share price valuation providing for downside protection and room for significant P/S [price to sales] and P/E [price to earnings] multiple expansion.” After screening for such firms, further evaluation is performed before the stocks are given “buy” recommendations.