Debt-free growth stocks with gains ahead

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ALARMFORCE INDUSTRIES $7.13 (Toronto symbol AF: SI Rating: Speculative) (1-800-267-2001; www.alarmforce.com; Shares outstanding: 12.2 million; Market cap: $87.2 million; No dividends paid) sells two-way voice alarm systems and monitoring services in Canada and the U.S. AlarmForce’s system differs from others because it lets emergency operators verify an alarm by establishing immediate, two-way voice contact with homeowners. It then dispatches security personnel to the client’s home. If intruders are present, the two-way contact can frighten them away. The company has used radio and TV advertising to gain a high profile. It gives its system away in order to add new subscribers. In return, they pay $25 a month for monitoring service, and sign on with a three-year contract. AlarmForce makes and owns each system. In the three months ended July 31, 2010, revenue rose 11%, to $9.5 million from $8.5 million a year earlier. Earnings fell 4.2%, to $1.36 million, or $0.11 a share, from $1.42 million, or $0.12. The company expanded into Minnesota…