COMPANIES TO WATCH
By JULIANNE SLOVAK

(FORTUNE Magazine) – TOWN & COUNTRY Some people like to collect jewelry; this company likes to collect jewelry manufacturers. Last November, Town & Country acquired L.G. Balfour Co., which manufactures class and championship rings, including the one-ounce World Series monster. A month later it picked up engagement- and wedding-ring maker Feature Enterprises Inc. These outfits should each add $100 million to T&C's sales this year, almost doubling revenues to some $425 million in fiscal 1990. The company is now one of the heftiest U.S. players in the highly fragmented jewelry industry. Although Jostens (1988 revenues: $560 million) is the best- known maker of class rings, jewelry accounts for only about half its business. The rest comes from yearbooks, clothing, and computer-based educational products. Town & Country's aggressive CEO, C. William Carey, 52, who started the company in his basement at age 17, is going after Jostens's market share. He's off to a good start, wooing away Jostens's largest single account, Gordon's Jewelers in Houston, as well as its contract to provide service awards to the employees of AT&T. Now that baby-boomers are settling down, sales of engagement and wedding + rings are helping the U.S. jewelry industry grow about 6% annually. Carey is especially fond of second marriages: Both principals are usually older and have more bucks to spend. Town & Country owns a retail giftware chain in the Caribbean, improbably called Little Switzerland, which is getting a boost from a 20% increase in tourism to the area. With plants in Hong Kong and Bangkok, Carey wants to increase Japanese jewelry sales of his Asian-made merchandise from 8% to 40% in three years. Town & Country also has plants in Massachusetts, New York, Kentucky, and Texas. Immediately after taking over Balfour, Carey met with its 2,500 employees. ''They had good ideas, but no one was listening to them,'' he says. ''They were not doing enough preliminary casting in wax; they were doing it in gold and there was too much waste.'' So Carey is changing all that. At the previously languid, family-owned Feature Enterprises, which has excellent manufacturing techniques, he is cutting fat and increasing productivity. Financial analyst Linda Baker of Prudential-Bache says, ''The company has a history of successfully assimilating acquisitions within a year.'' T&C stock sold recently for $9.50 a share, eight times this year's anticipated earnings.

MOUNTAIN MEDICAL Before the federal government decided to standardize its Medicare policy on home respiratory equipment, this Colorado company had some unhealthy times. But last year Washington decided to set a reimbursement schedule that favors oxygen concentrators, machines that extract oxygen from the air. Since the company has 55% of this market, earnings jumped to an estimated $1.5 million on revenues of about $32 million in fiscal 1989. The stock flew from $3.50 a share a year ago to over $16 in February. The company is starting to market its concentrators in Japan. Mountain Medical Equipment will shortly introduce a portable, battery-operated nebulizer that converts asthma medication into a mist. Barbara Dau Hoffman, a security analyst at Boettcher & Co. in Denver, predicts Mountain Medical's profits for fiscal 1990 will be up 225% to nearly $5 million on revenues of $52 million. The share price has leveled off to about $15, ten times projected earnings.

JAZZERCISE Step, kick, kick, knee, kick, touch. Again . . . The dancers in Judi Sheppard Missett's Jazzercise classes may never make it to A Chorus Line, but they've helped turn her talent into a $12 million business. Way back in 1969, Missett, who has a degree in theater and dance from Northwestern, noticed that the women in her jazz classes weren't getting what they really wanted -- an enjoyable way to keep fit. ''The only options were boring calisthenics or classes meant to train professional dancers,'' says Missett. She began offering a combination of jazz and aerobics. After five exhausting years trying to teach every class herself, Missett started training other instructors and franchising her operation. Now Jazzercise is swinging all over the U.S. and in 34 foreign countries. In February, People Co. Ltd., the largest operator of health clubs in Japan, signed a deal to offer Jazzercise classes to members. One-third of the privately held company's sales come from videocassettes and dancewear catalogues.

UNI-MARTS INC. This convenience store operator ventures far off the beaten track for business. Its 335 outlets are in rural areas of Delaware, New Jersey, New York, and Pennsylvania. Because Uni-Marts offer everything from dry goods to gasoline to videocassettes to pizza, they often become ''town stores,'' social centers for the community. Uni-Marts' small-town strategy gives it growth potential higher than the convenience store norms. Says analyst Christopher Vroom of Baltimore broker Alex. Brown & Sons: ''The market they're in is very undersaturated.'' About 140 small convenience chains are trying to make it big in Uni-Marts' boondocks, and Vroom thinks the company can acquire many of them. Half the retailer's growth already comes from acquired stores, half from new ones. Over the past three years, sales have grown 16% annually to $137 million in 1988, and profits have increased 64% a year to almost $3 million. The stock recently traded over the counter at $7 a share, 11 times this year's anticipated earnings.