Based on the mail I receive, many of you are becoming a bit queasy with regard to Wall Street. While I believe that a recession is considerably more likely than not, and that we are in for a period of rising market volatility and falling stock prices, now is when you look for bargains … not the exit.

However, you are going to have to look a bit harder and you might want to investigate smaller companies with a proprietary technological advantage. One example is a relatively new green company that deals with construction technology.

Before you associate construction with the subprime debacle and the moribund housing market, keep in mind that construction covers government and commercial contracts (including building in Iraq), in addition to disaster recovery and rebuilding, not just new home construction.

Based in Florida, Alternative Construction Technologies (formerly Alternative Construction) is a green company that recently caught my eye because of the ability of its product, called the ACTech panel, to withstand the flying debris caused by a hurricane. An 8-foot, 6-pound, 2-by-4 board was shot at 45 mph at three construction materials. The board went straight through a wood panel. It also cracked a concrete wall.

In two shots at the ACTech panel, the flying 2-by-4 managed to dent the material on the first try and to pierce it, but not pass through it, on the second. To repair the damage, you simply cut out and replace the dented area.

The panels are energy efficient to the extent that they can reduce home heating and cooling costs by as much as 70 percent. An important factor because buildings account for 41 percent of the nation's total energy consumption, of which heating and cooling consume 20 percent.

The panels are fire, mold and insect resistant. The Home Depot has used them for building extensions at numerous store locations. Florida has approved their use in more than 1,200 buildings in the state. The federal government has just placed the product on the GSA schedule, enabling government agencies to purchase the product without going through the bid process.

Tony Francel, the company's chief operating officer, has presented his views on the state of the environment to the United Nations on several occasions, stating that "we need to help protect the environment by providing environmentally friendly products at competitive prices that have long-term economic benefits."

For the nine months ended Sept. 30, Alternative chalked up sales of $9.02 million, with a 23.9 percent gross profit margin and net earnings of $738,055, or 7 cents per share. The company has $14.1 million in contracts under way, and is currently looking at a potential pipeline many times that.

Although the company built its first home 14 years ago, with sales increasing at a 188 percent average compounded rate over the past three years, it only became a profitable concern in 2007 under new management. Therefore, it is not possible to apply the usual intrinsic value calculations in a meaningful way.

However, the company has a leading patented product in an industry McGraw Hill estimates will grow at least 60 percent per year over the next five years. An over-the-counter stock [ACCY.OB], the company has applied for listing on the American Stock Exchange, which should improve its ability to raise additional capital if or when needed.

My earnings estimate for 2008 is 17 cents per share and 35 cents per share in 2009, with a 12- to 18-month target price on the shares of $9.25, vs. a recent price of $5.20. Although returns are greater with a smaller company in undergoing an early growth phase, there is a commensurate risk factor. Therefore, you need to be exacting in your own due diligence.

If you wish to review the materials I used, they are available on RuddReport.com.