At last, we've made it! This is the final article in the great industries for investment series. If you haven't seen the other articles up to now, you can find them linked below:

"Red Dot" Industries

1. Airlines
2. Restaurants
3. Brick & Mortar Retail
4. Automobiles
5. "Parasite" Business Models

"Green Dot" Industries

1. Payment Processing
2. Social Networks
3. Enterprise Software
4. Online Marketplaces
5. This Article!

Our final entry will wrap up the "green dot" list - places to find attractive companies for investment.

To tell you the truth, this article was the longest one to put together in the series. The other four "green dot" industries we investigated are clearly outstanding business models in today's day and age. All of them play into worldwide mega-trends, have outstanding financial characteristics, and have solid, durable competitive advantages.

But these are not easy to find, wholesale. In fact, I had a lot of trouble finding a fifth industry that was as attractive top-to-bottom as those four. They still represent our "best ideas" for places to go fishing for great companies.

However, every now and then you can catch a big fish in a small pond. For this final article, let's take a look at a few industries that - while every participant in them certainly isn't of "green dot" caliber - they still provide attractive characteristics that could produce a few select companies definitely worth a look.

What are they? Here we go...

Medical Devices

Medical devices, by and large, is an interesting space for investment.

There are certainly durable competitive advantages in the form of regulatory barriers and switching costs. Of course, there is the hurdle of getting a device approved by the FDA - no small feat. But then, you must convince doctors and surgeons that your device is better than alternative methods of treatment - also not a small feat, given the (understandably) conservative, risk-averse nature of the field. The upside is that, once your device has found its way into the standard-of-care, it is much more difficult for a competitor to displace it.

There is also pretty good growth potential in the field. Demographic trends in established economies have been skewing older for some time, and an older populace naturally increases the demand for medical devices. Obesity epidemics in some developed nations has also led to increased demand for medical services. Also, the medical field remains a ripe space for technological advancement.

The most attractive ("green-dot") firms in this space will probably be found in the latter category, where products address deficiencies in the current standards of care, providing a big growth runway. Two examples are Intuitive Surgical (ISRG), whose robotic surgery machines have revolutionized prostate and hysterectomy procedures, and Align Technologies (ALGN), whose Invisalign product is a massive improvement over traditional metal orthodontic braces.

Branded Consumer Soft Goods

One of the oldest industries in America remains a decent place to find interesting stocks.

Consumers love brands. Brands are an implicit "contract" between company and consumer, assuring the consumer a standard of quality and reliability in exchange for a higher price. As long as the company does not break its end of the brand contract, consumers are likely to purchase the brand "automatically" over competing offerings.

This dynamic is most powerful in the "soft" goods category. Soft goods refer to items that are consumed in short order, necessitating regular re-purchases. Some examples would be things like soft drinks (Coke/Pepsi), coffee (Starbucks), diapers (Pampers), tissues (Kleenex), and so forth. The frequency of purchase for soft goods sets up a near-recurring revenue model, and the brand contract creates a strong, durable competitive advantage for the company.

The weakness of this space is growth potential. Many of the dominant brands here have been around for decades, and have largely fulfilled their growth potential, leaving little room for further expansion.

The "green-dot" opportunities here are up-and-coming brands that are disrupting the incumbents in new and novel ways. For example, Monster Beverage (MNST) delivered a 1,400% return over the past decade - one of the best performing stocks in the entire market. Is the next Monster out there somewhere?

Branded Pharmaceuticals (especially Biotech)

While we are not big fans of the generic pharmaceutical industry (it is a commodity market), there are still some attractive opportunities within the branded pharma space, particularly within the biotech realm.

This industry has its good points. There is a natural moat provided by patent protection (a regulatory barrier), which can protect high profits on a drug for a decade or more. In many cases, treatments target chronic diseases, necessitating ongoing, recurring purchases of a product. Also, the demographic and social trends noted in the medical device section holds true here. On the whole, demand for healthcare - including pharmaceuticals - is a secular growth market worldwide.

However, one needs to be careful wading into this space. Chemically based compounds are easily copied by generics companies, who are quite good at challenging patents, and even better at destroying branded sales once off-patent. There is an ongoing pressure for these firms to successfully develop new and novel drugs through their pipeline to replace sales from products that go off-patent. Big pipeline failures can lead to abrupt and massive drops in stock value.

In general, the "green-dot" opportunities here have a few characteristics. One, they have a wide portfolio of revenue producing products - at least 4 major contributors instead of the numerous one-or-two product pharmaceutical firms out there. Two, they are considered a "biotech", with biologically based drugs which are much harder for generic firms to copy. Three, the company has a strong pipeline with which to grow. One good example of a company meeting these criteria would be Celgene (CELG).

Conclusion

These are just a few industries where "green dot" stocks may be found. But tread carefully. While these industries have good choices, they may also have some not-so-good choices, where growth potential is limited (or negative) and durable competitive advantages have long since been eroded away.

I hope you have enjoyed this (long) series of industry-level reviews. The point here is to help you build a mental framework of what constitutes a good business model vs. a not-so-good one. Once you can understand this at a high level, making great stock picks to hold for the long-term becomes a much easier process.