John Lewis doesn’t have much bad to say about Mod-Pac these days. With the Buffalo printing company earning more than $1 million during each of the last two quarters—its strongest earnings in four years—Lewis, a partner at Osmium Partners, a San Francisco investment company that owns about 14 percent of Mod-Pac’s stock, likes what he sees lately at Mod-Pac.

“It’s been a long time in coming,” Lewis told Mod-Pac executives during a conference call last week. “You seem like you’re really on the right track.”

That praise, coming from Mod-Pac’s largest outside shareholder, was even more significant since it was just two years ago when Lewis was one of the company’s harshest critics, bemoaning its plunging share price and its steadily dropping sales.

“I think there’s a great deal of frustration among shareholders,” Lewis said back in May 2008, when Mod-Pac was in the midst of a four-year decline that, at that point, showed no signs of stopping.

Lewis badgered Mod-Pac executives to buy back stock when the price was way down and sell off excess equipment as business fell off. Other major investors suggested the company go private.

But Lewis’ tone is much different now, although he still is pushing for the company to buy back stock or start paying a dividend. And the stock, while up from its low of just over $1 in November 2008, trades at just 75 percent of its book value after closing at $5.03 on Friday. That’s 70 percent less than the shares were worth in August 2005.

Yet Lewis’ parting remark to Mod- Pac’s executives last week was something he never would have said two years ago: “Great work, guys.”

Indeed, much of the change stems from a sea change in attitude within Mod-Pac’s executive offices. When online printed products marketer Vista- Print Ltd. bolted five years ago as Mod- Pac’s biggest customer, leaving a $12 million hole in its revenue stream—the company focused on winning new business to fill the gap. They tried to start their own VistaPrint-type business. They even tried to branch out into the direct mail business. None of it worked, and revenues kept dropping.

Finally, as shareholders grew restless, Mod-Pac executives shifted gears. While they initially hesitated to cut jobs in hopes of quickly replacing the VistaPrint business, they finally gave in and trimmed more than 60 jobs, leaving the company with 363 workers at their Buffalo plant.

They scrapped the direct mail venture, along with its specialty print business, last June when both continued to lose money. They slashed capital spending in half, down to $1 million last year. They shifted their Krepe-Kraft personalized print business in Blasdell to its Buffalo factory. They sold Krepe-Kraft’s Blasdell plant and the direct mail business’ assets, providing a $2 million cash infusion for a company that was running with just a tiny cash cushion for most of last year.

“We are doing more with less,” says David Lupp, Mod-Pac’s chief operating officer and chief financial officer.

Most importantly, the moves lowered the company’s break-even point to around $12 million, a level that Mod-Pac has been able to easily surpass for two straight quarters, even in a nasty recession.

Now, as Lewis noted, profitability is way up, and the company, with no debt and nearly $4 million in cash on its books, is in much better financial shape.

“A lot of our results are driven by a focus on cost management,” says Daniel G. Keane, Mod-Pac’s president and chief executive officer.

Lewis apparently likes what he’s seeing, too. He shelled out more than $70,000 within the last two weeks to buy another 17,900 shares of Mod-Pac stock.