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But it's not just defense: The company's access equipment market is also highly cyclical, dependent on factors as diverse as housing starts, oil and gas activity, and equipment-rental company consolidation. Broadly, though, the segment is tied to the health of the global economy, which has been recovering very slowly since the 2008 financial crisis. In fact, the slow recovery has had a negative impact on Oshkosh's sales volume relative to its historical levels in all of its non-defense areas. Lower housing starts are bad enough for Oshkosh on their own, but they also affect municipal tax revenues, which leads to lower sales of garbage trucks and fire trucks. If the recovery continues to be this slow -- or, worse, starts going in reverse -- then Oshkosh will be in big trouble. However, in a cyclical industry, even bust cycles have an end, and investors can be rewarded for buying a cyclical company near the end of one. Risk No. 3: A fragmented market The specialty vehicles market is a fragmented market, with Oshkosh sandwiched between small regional companies on one end and divisions of global giants like Caterpillar on the other. Oshkosh tries to use its medium size to its advantage by utilizing economy of scale over its smaller competitors, and its flexibility and ability to customize equipment over its larger ones. For the most part, this seems to be working.

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