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Stocks that are related to “green” technology have been some of the biggest gainers over the past year. However, a lot of these stocks (think solar companies) have already had tremendous run-ups in price and they are trading at very lofty valuations.

I have found a “green” company that is experiencing strong growth, trades at a lower valuation than most “green” stocks, and even pays a dividend. That company is Aixtron (NASDAQ:AIXG).

Aixtron is a German manufacturer of equipment used to make LEDs (Light Emitting Diodes). Aixtron’s equipment is also used for other applications but I think the growth in LEDs will be the catalyst for strong growth at Aixtron for the next few years.

In 2007 Aixtron’s financial numbers improved considerably over the prior year. Revenue grew 25%, NI grew 195%, and EPS grew 171%. For 2008 Aixtron has given guidance for revenue between 270 and 300 Euros. If it only meets the low end of its projection, it will have another increase of 25% over the prior year.

Aixtron currently has a trailing PE of 47 which isn’t cheap compared to traditional stocks. However, compared to other fast growing “green” companies Aixtron is pretty inexpensive (some solar companies have trailing PEs over 100). Also, since growth is so hard to find, fast growing companies can trade at high PE multiples.

Aixtron has proposed a dividend of 0.07 Euros per share which will be voted on at the shareholders meeting on May 14. If approved this will be another benefit to owning Aixtron.

Aixtron also looks good from a technical perspective. The stock price has been in an uptrend for the past couple of years and there isn’t much overhead resistance. If the price breaks out it should be able to run for a while.

I think Aixtron is an attractive company to own and I am going to give a buy recommendation with a price target of 20-25 dollars within the next year.

Disclosure: I have no position in AIXG.

Source: Aixtron: LEDs a Catalyst for Growth