Growth Stocks
Although growth stock picks can be highly volatile, they can make good long-term investments. They may be well-known stars or quiet gems, but they do share one common attribute—they are growing at a higher-than-average rate within their industry, or within the market as a whole, and could keep growing for years or decades.
And keep in mind that we focus on growth stocks, which have a good long-term history and favourable prospects. We downplay momentum stocks that tend to attract many investors simply because they are moving faster than the market averages, but are liable to fall sharply when their momentum fades.
There’s room for growth stock investing in your portfolio, but make sure you follow our TSI Network three-part Successful Investor strategy for your overall portfolio:
- Invest mainly in well-established companies;
- Spread your money out across most if not all of the five main economic sectors (Manufacturing & Industry; Resources & Commodities; Consumer; Finance; Utilities);
- Downplay or avoid stocks in the broker/media limelight.
Make better stock picks when you read this FREE Special Report, Canadian Growth Stocks: WestJet Stock, RioCan Stock and More.
Read More
Close
NORDSTROM INC. $63 (New York symbol JWN; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 197.0 million; Market cap: $12.4 billion; Price-to-sales ratio: 1.0; Dividend yield: 1.9%; TSINetwork Rating: Average; www.nordstrom.com) mainly sells upscale clothing, accessories and footwear. The company owns and operates 261 stores in 35 states.
In the third quarter of its 2014 fiscal year, which ended November 2, 2013, Nordstrom’s sales rose 2.8%, to $2.9 billion from $2.8 billion a year earlier.
Same-store sales rose just 0.1%. That’s mainly because the company’s popular anniversary sale occurred in the second quarter of fiscal 2014, but straddled the second and third quarters a year earlier. If you adjust for this, same-store sales rose 2.4%.
...
In the third quarter of its 2014 fiscal year, which ended November 2, 2013, Nordstrom’s sales rose 2.8%, to $2.9 billion from $2.8 billion a year earlier.
Same-store sales rose just 0.1%. That’s mainly because the company’s popular anniversary sale occurred in the second quarter of fiscal 2014, but straddled the second and third quarters a year earlier. If you adjust for this, same-store sales rose 2.4%.
...
L BRANDS INC. $65 (New York symbol LB (old symbol LTD); Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 289.9 million; Market cap: $18.8 billion; Price-to-sales ratio: 1.8; Dividend yield: 1.8%; TSINetwork Rating: Average; www.limitedbrands.com) owns 1,096 Victoria’s Secret lingerie stores and 1,645 Bath & Body Works personal care products outlets. Smaller chains include 157 La Senza (lingerie) locations in Canada and 29 Henri Bendel (jewellery) stores in the U.S.
The company continues to see strong demand for its Victoria’s Secret Pink clothing line for younger women. In the current fiscal year, L Brands plans to open 50 new stand-alone Pink stores, while it continues to expand the brand in its existing outlets.
Currently, 25% of Victoria’s Secret stores carry the full Pink assortment. New soaps and home fragrances are also fueling sales at Bath & Body Works.
...
The company continues to see strong demand for its Victoria’s Secret Pink clothing line for younger women. In the current fiscal year, L Brands plans to open 50 new stand-alone Pink stores, while it continues to expand the brand in its existing outlets.
Currently, 25% of Victoria’s Secret stores carry the full Pink assortment. New soaps and home fragrances are also fueling sales at Bath & Body Works.
...
MACY’S INC. $54 (New York symbol M, Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 376.2 million; Market cap: $20.3 billion; Price-to-sales ratio: 0.8; Dividend yield: 1.9%; TSINetwork Rating: Average; www.macysinc.com) operates 840 Macy’s and Bloomingdale’s department stores in 45 states.
In the third quarter of its 2014 fiscal year, which ended November 2, 2013, Macy’s sales rose 3.3%, to $6.3 billion from $6.1 billion a year earlier. Same-store sales— which include online orders— gained 3.5%. If you include commissions from areas of its stores that Macy’s licenses to other sellers, same-store sales would have risen 4.6%.
Earnings jumped 22.1%, to $177 million from $145 million. The company spent $447 million on share buybacks during the quarter. As a result, its per-share earnings rose at a faster rate of 30.6%, to $0.47 from $0.36.
...
In the third quarter of its 2014 fiscal year, which ended November 2, 2013, Macy’s sales rose 3.3%, to $6.3 billion from $6.1 billion a year earlier. Same-store sales— which include online orders— gained 3.5%. If you include commissions from areas of its stores that Macy’s licenses to other sellers, same-store sales would have risen 4.6%.
Earnings jumped 22.1%, to $177 million from $145 million. The company spent $447 million on share buybacks during the quarter. As a result, its per-share earnings rose at a faster rate of 30.6%, to $0.47 from $0.36.
...
WAL-MART STORES INC. $81 (New York symbol WMT; Conservative Growth Portfolio: Consumer sector; Shares outstanding: 3.3 billion; Market cap: $267.3 billion; Price-to-sales ratio: 0.6; Dividend yield: 2.3%; TSINetwork Rating: Above Average; www.walmart.com) earned $3.9 billion in its fiscal 2014 third quarter, which ended October 31, 2013. That’s up 1.6% from $3.8 billion a year earlier. Per-share earnings gained 6.5%, to $1.14 from $1.07, on fewer shares outstanding.
Overall sales rose 1.7%, to $115.7 billion from $113.8 billion. Sales at the company’s U.S. stores, which supply 59% of the total, increased 2.4%. However, same-store sales fell 0.3%, as shoppers lowered their spending due to high unemployment and uncertainty over future health insurance premiums in the wake of the Affordable Care Act (or Obamacare).
However, sales at the international stores (29% of the total) gained 4.1%, excluding exchange rates. New locations in fast-growing markets like China and Africa should continue to offset slower sales in the U.S. Moreover, Wal-Mart could unlock some of its value by spinning off its Sam’s Club warehouse outlets (12%). This chain’s sales rose 1.1% in the latest quarter.
...
Overall sales rose 1.7%, to $115.7 billion from $113.8 billion. Sales at the company’s U.S. stores, which supply 59% of the total, increased 2.4%. However, same-store sales fell 0.3%, as shoppers lowered their spending due to high unemployment and uncertainty over future health insurance premiums in the wake of the Affordable Care Act (or Obamacare).
However, sales at the international stores (29% of the total) gained 4.1%, excluding exchange rates. New locations in fast-growing markets like China and Africa should continue to offset slower sales in the U.S. Moreover, Wal-Mart could unlock some of its value by spinning off its Sam’s Club warehouse outlets (12%). This chain’s sales rose 1.1% in the latest quarter.
...
TUPPERWARE BRANDS CORP. $92 (New York symbol TUP; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 50.7 million; Market cap: $4.7 billion; Price-to-sales ratio: 1.9; Dividend yield: 2.7%; TSINetwork Rating: Above Average; www.tupperwarebrands.com) gets about 70% of its sales by making high-quality products for the home, mainly plastic food and beverage containers. The remaining 30% comes from its beauty-products division, which makes a wide range of cosmetics, bath oils and fragrances. This division also makes related products like jewellery and bed linens.
The company’s main brands include Tupperware, Armand Dupree, Avroy Shlain, BeautiControl, Fuller, NaturCare, Nutrimetics and Nuvo. International markets supply 90% of its sales.
The company’s main brands include Tupperware, Armand Dupree, Avroy Shlain, BeautiControl, Fuller, NaturCare, Nutrimetics and Nuvo. International markets supply 90% of its sales.
Direct sales model is a huge asset
...
< strong>MCCOY CORP. $6.37 (Toronto symbol MCB; TSINetwork Rating: Speculative) (780-453-8451; www.mccoyglobal.com; Shares outstanding: 26.9 million; Market cap: $171.0 million; Dividend yield: 3.1%) operates through two divisions: Mobile Solutions and Energy Products and Services.
< br /> Energy Products and Services sells hydraulic equipment, including power tongs, for drilling rigs. Power tongs are large wrench-like tools that tighten and loosen the pipe in the drill hole.
< br /> Mobile Solutions builds heavy-duty trailers for U.S. and Canadian clients in the oil and gas, wind energy, infrastructure and construction industries.
...
< br /> Energy Products and Services sells hydraulic equipment, including power tongs, for drilling rigs. Power tongs are large wrench-like tools that tighten and loosen the pipe in the drill hole.
< br /> Mobile Solutions builds heavy-duty trailers for U.S. and Canadian clients in the oil and gas, wind energy, infrastructure and construction industries.
...
WAJAX CORP. $35.72 (Toronto symbol WJX; TSINetwork Rating: Extra Risk) (905-212-3300; www.wajax.ca; Shares outstanding:16.7 million; Market cap: $601.2 million; Dividend yield: 6.7%) sells and services cranes, forklifts and other heavy equipment. It also provides related parts (such as bearings, motors, hoses and fittings) and power systems (including diesel engines and transmissions).
< br /> The company’s customers are in the resource, construction, manufacturing and transportation industries.
< br /> In the three months ended September 30, 2013, Wajax’s revenue declined 5.0%, to $338.5 million from $356.4 million a year earlier. Earnings fell 28.6%, to $11.5 million, or $0.69 a share, from $16.2 million, or $0.97.
...
< br /> The company’s customers are in the resource, construction, manufacturing and transportation industries.
< br /> In the three months ended September 30, 2013, Wajax’s revenue declined 5.0%, to $338.5 million from $356.4 million a year earlier. Earnings fell 28.6%, to $11.5 million, or $0.69 a share, from $16.2 million, or $0.97.
...
CHEMTRADE LOGISTICS INCOME FUND $17.09 (Toronto symbol CHE.UN; TSINetwork Rating: Speculative) (416-496-5856; www.chemtradelogistics.com; Units outstanding: 41.7 million; Market cap: $709.7 million; Dividend yield: 7.0%) is in talks to buy specialty chemicals maker General Chemical Corp. from private equity firm American Securities LLC for as much as $1 billion. American Securities took General Chemical private for $673 million in 2009.
< br /> General Chemical makes a wide range of chemicals. In addition to water treatment and pharmaceuticals, its main markets include oil refining, pulp and paper, agriculture and food and beverage.
< br /> This would be a huge acquisition for Chemtrade, more than doubling its $706.4- million market cap. A major purchase like this can always backfire, but it would likely be a good fit, offering Chemtrade both growth prospects and diversification.
...
< br /> General Chemical makes a wide range of chemicals. In addition to water treatment and pharmaceuticals, its main markets include oil refining, pulp and paper, agriculture and food and beverage.
< br /> This would be a huge acquisition for Chemtrade, more than doubling its $706.4- million market cap. A major purchase like this can always backfire, but it would likely be a good fit, offering Chemtrade both growth prospects and diversification.
...
< strong>TOROMONT INDUSTRIES LTD. $25.47 (Toronto symbol TIH; TSINetwork Rating: Extra Risk) (416-667- 5511; www.toromont.com; Shares outstanding: 76.6 million; Market cap: $2.0 billion; Dividend yield: 2.0%) distributes a wide range of industrial equipment, including machinery made by Caterpillar Inc. It also makes refrigeration systems through its CIMCO division.
In the three months ended September 30, 2013, higher equipment sales and rentals, particularly to mining, construction and agriculture customers, pushed up Toromont’s revenue by 20.0%, to $498.3 million from $415.0 million a year earlier.
Earnings per share rose 32.6%, to $0.57 from $0.43, on the higher sales and improved profit margins.
...
In the three months ended September 30, 2013, higher equipment sales and rentals, particularly to mining, construction and agriculture customers, pushed up Toromont’s revenue by 20.0%, to $498.3 million from $415.0 million a year earlier.
Earnings per share rose 32.6%, to $0.57 from $0.43, on the higher sales and improved profit margins.
...
< strong>TIM HORTONS $61.81 (Toronto symbol THI; TSINetwork Rating: Average) (905-845-6511; www.timhortons.com; Shares outstanding: 151.0 million; Market cap: $9.1 billion; Dividend yield: 1.7%) is testing a new dark roast blend of its coffee in London, Ontario, and Columbus, Ohio.
< br /> For the past 49 years, the company has had huge success with its medium-roast coffee. However, many of its competitors now offer a variety. For example, Starbucks recently launched a lighter blend that is similar to Tim Hortons’ regular blend.
< br /> If this test is successful, Tim Hortons could start selling the dark roast in all of its 4,300 stores in 2014.
...
< br /> For the past 49 years, the company has had huge success with its medium-roast coffee. However, many of its competitors now offer a variety. For example, Starbucks recently launched a lighter blend that is similar to Tim Hortons’ regular blend.
< br /> If this test is successful, Tim Hortons could start selling the dark roast in all of its 4,300 stores in 2014.
...