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.
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CALIAN TECHNOLOGIES $20.35 (Toronto symbol CTY; www.calian.com) operates in two areas: the business and technology services division (which supplies 70% of Calian’s revenue) provides engineers, health care workers and other skilled professionals to clients on a contract basis. The systems engineering division (30% of revenue) sells hardware and software for testing, operating and managing satellite and other communication systems....
CANADIAN TIRE CORP. $74 (Toronto symbol CTC.A; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 81.2 million; Market cap: $6.0 billion; Price-to-sales ratio: 0.5; Dividend yield: 1.9%; TSINetwork Rating: Above Average; www.canadiantire.ca) operates 490 Canadian Tire stores, which specialize in automotive, household and sporting goods. The company owns these stores, but franchisees (called dealers) operate most of them.
The company recently negotiated a new 11-year contract with its dealers. This should make it easier for Canadian Tire and its dealers to remodel stores and adjust inventories as they compete with U.S.- based retailers like Wal-Mart and Target.
Canadian Tire is a buy....
The company recently negotiated a new 11-year contract with its dealers. This should make it easier for Canadian Tire and its dealers to remodel stores and adjust inventories as they compete with U.S.- based retailers like Wal-Mart and Target.
Canadian Tire is a buy....
Pat McKeough responds to many requests for advice on specific stocks and other questions on investment and the economy from the members of his Inner Circle. Every week, his comments and recommendations on the most intriguing questions of the past week go out to all Inner Circle members. And each week, we offer you one of the highlights from these Q&A sessions. While we reserve our buy-hold-sell advice for Inner Circle members, these excerpts provide a great deal of information and analysis on stocks we’ve covered for members of Pat’s Inner Circle. This week, an Inner Circle member asked about the largest wireless provider in the world. China Mobile competes with two other Chinese wireless providers, each of which has the advantage of being compatible with Apple iPhones, while China Mobile is not. Pat looks at whether an upgrade of China Mobile’s network and new chip technology will let it hook up with Apple and other popular smartphones and keep its lead in the Chinese market. ...
SYMANTEC CORP. $23 (Nasdaq symbol SYMC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 696.6 million; Market cap: $16.0 billion; Price-to-sales ratio: 2.3; Dividend yield: 2.6%; TSINetwork Rating: Average; www.symantec.com) makes software that protects computers from viruses and intruders, including the popular Norton anti-virus program. It also sells products and services, such as e-mail filtering and data backup, to businesses.
In July 2005, the company paid $13.2 billion for Veritas Software, whose software stores and protects information in large databases. The deal cut the company’s reliance on selling software to consumers and helped it compete with larger computer-services firms, like IBM.
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In July 2005, the company paid $13.2 billion for Veritas Software, whose software stores and protects information in large databases. The deal cut the company’s reliance on selling software to consumers and helped it compete with larger computer-services firms, like IBM.
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CEDAR FAIR L.P. $43 (New York symbol FUN; Income Portfolio, Consumer sector; Units outstanding: 55.6 million; Market cap: $2.4 billion; Price-to-sales ratio: 2.2; Dividend yield: 5.8%; TSINetwork Rating: Average; www.cedarfair.com) lost $1.95 a share in the first quarter of 2013, compared to a loss of $1.18 a year earlier. That’s mainly due to a one-time charge on the early retirement of debt. Cedar Fair typically loses money in the first quarter, as most of its 11 amusement parks and seven water parks close during the winter. However, revenue jumped 48.2%, to $41.8 million from $28.2 million, thanks to higher attendance and per-guest spending at its Knott’s Berry Farm year-round park in southern California.
The stock has gained 60% in the past year. However, that’s mainly due to its rising distributions, which could slow this year.
Cedar Fair is still a hold....
The stock has gained 60% in the past year. However, that’s mainly due to its rising distributions, which could slow this year.
Cedar Fair is still a hold....
PROCTER & GAMBLE CO. $79 (New York symbol PG; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 2.7 billion; Market cap: $213.3 billion; Price-to-sales ratio: 2.7; Dividend yield: 3.1%; TSINetwork Rating: Above Average; www.pg.com) recently raised its quarterly dividend by 7.0%, to $0.6015 a share from $0.562....
FORD MOTOR CO. $16 (New York symbol F; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 3.9 billion; Market cap: $62.4 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.5%; TSINetwork Rating: Extra Risk; www.ford.com) continues to expand in China. It sold 75,331 vehicles in that country in April 2013, up 37% from April 2012. That’s mainly due to strong demand for its new Focus sub-compact car and several of its sport utility models.
The company plans to launch 15 new vehicles in China by 2015. It also aims to double its production capacity in China, to 1.2 million vehicles, by 2015.
Ford is a buy.
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The company plans to launch 15 new vehicles in China by 2015. It also aims to double its production capacity in China, to 1.2 million vehicles, by 2015.
Ford is a buy.
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ALCOA INC. $8.58 (New York symbol AA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.1 billion; Market cap: $9.4 billion; Price-to-sales ratio: 0.4; Dividend yield: 1.4%; TSINetwork Rating: Average; www.alcoa.com) is looking at more ways to cut costs, as aluminum prices have dropped 33% from their 2011 peak.
In response to the lower prices, the company has already closed about 13% of its smelting capacity. It is now thinking about lowering its production by a further 11%. This should help it reach its goal of cutting its operating costs by around 10% by 2015.
Alcoa is a buy.
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In response to the lower prices, the company has already closed about 13% of its smelting capacity. It is now thinking about lowering its production by a further 11%. This should help it reach its goal of cutting its operating costs by around 10% by 2015.
Alcoa is a buy.
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GANNETT CO. INC. $22 (New York symbol GCI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 229.6 million; Market cap: $5.1 billion; Price-to-sales ratio: 0.9; Dividend yield: 3.6%; TSINetwork Rating: Average; www.gannett.com) earned $86.0 million in the first quarter of 2013. That’s up 6.5% from $80.8 million a year earlier. Earnings per share rose 8.8%, to $0.37 from $0.34, on fewer shares outstanding. Revenue climbed 1.6%, to $1.24 billion from $1.22 billion.
The company continues to benefit from its move to charge users for access to its newspapers’ websites: revenue from its Internet operations (which supply 15% of the total) rose 3.9%. It now has 50,000 digital subscribers and feels this will rise to 300,000 by 2014. However, weaker demand for print advertising cut revenue at Gannett’s newspaper division (69% of revenue) by 0.3%. Revenue from its 23 TV stations (16%) rose 8.7% due to higher retransmission fees from cable and satellite TV operators.
Gannett is a buy.
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The company continues to benefit from its move to charge users for access to its newspapers’ websites: revenue from its Internet operations (which supply 15% of the total) rose 3.9%. It now has 50,000 digital subscribers and feels this will rise to 300,000 by 2014. However, weaker demand for print advertising cut revenue at Gannett’s newspaper division (69% of revenue) by 0.3%. Revenue from its 23 TV stations (16%) rose 8.7% due to higher retransmission fees from cable and satellite TV operators.
Gannett is a buy.
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BHP BILLITON LTD. ADRs $66 (New York symbol BHP; Conservative Growth Portfolio, Resources sector; ADRs outstanding: 2.7 billion; Market cap: $178.2 billion; Price-to-sales ratio: 2.5; Dividend yield: 3.5%; TSINetwork Rating: Average; www.bhpbilliton.com) plans to spend $18 billion developing new mines in the fiscal year ending June 30, 2014, down 18.2% from $22 billion in fiscal 2013. That’s because slowing economic growth in China has hurt prices for commodities like iron ore, copper and coal.
This spending should continue to fall in future years, because many of the projects that BHP is developing will start up in 2015.
BHP Billiton is a buy....
This spending should continue to fall in future years, because many of the projects that BHP is developing will start up in 2015.
BHP Billiton is a buy....