Up 172% for the year so far.

Up 23% over the last month.

Up 18% over the last week.

Up 6% today!

Codan Limited (ASX: CDA) is on its way back!

The share price is within touching distance of the $2 mark it pierced through in 2013, before a low of 52 cents that followed a disappointing series of events which resulted in the company’s profit plunging from $42 million in 2013 to just $9 million in 2014.

What’s happened?

A series of new products in the metal detection and radio communications space have been well received by the market and will result in first half profit surging to between $20 million and $22 million, compared with full-year profit of $22 million last financial year.

This year’s full year underlying profit is expected to be in the range of $30 million to $32 million.

A Turnaround in the Making?

Many a famed investor has repeated that ‘turnarounds seldom turn’, implying that there’s not many cases of companies turning around major operational issues and restoring the business to former levels of profitability and/or success.

In this case however, Codan’s woes in 2014 came from an extremely unlikely source – Chinese counterfeiters making pretty-decent replicas of Codan’s market-leading metal detectors. Presumably the company has figured out how to overcome that issue as the new detectors have been a hit and will now become a target again.

Codan also recently won a new contract with the Australian Defence Force– a great sign of the robustness and potential for future sales of both metal detection and communication devices.

All going well, Codan is trading on a price to earnings ratio of around 11 and a dividend yield well over 4% fully franked if dividends increase with profits!

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Motley Fool contributor Andrew Mudie owns shares of Codan Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.