Growth Stocks

Growth stocks are companies that are likely to have sales and earnings growth well above market average. Frequently they pay few, if any, dividends. Instead they typically reinvest any extra cash flow to promote further growth. Chosen wisely—according to Pat McKeough’s advice—high-quality growth-oriented stocks can be worthwhile additions to most well-diversified portfolios.

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

Growth Stocks Library Archives

Growth Stocks

Updating your Conservative stocks: Sherwin-Williams, Sony Group, and Honda Motor

SHERWIN-WILLIAMS CO. $334 (www.sherwin-williams.com) is a hold. The paint maker is up 38% in the past year as COVID-19 lockdowns have prompted consumers to update their home decor. However, shortages of raw materials are driving up Sherwin’s costs....

1 min read

Pat McKeough

Growth Stocks

FedEx wins with the shift to online shopping

Rising fuel costs and labour shortages, particularly driver salaries, have weighed on FedEx’s shares in the past few months. However, the company’s outlook remains strong, particularly as the COVID-19 pandemic continues to prompt consumers to buy more goods online.

FEDEX CORP....

2 min read

Pat McKeough

Growth Stocks

Apple’s momentum could stall

APPLE INC. $173 is still a hold. The company (Nasdaq symbol AAPL; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 16.4 billion; Market cap: $2.8 trillion; Price-to-sales ratio: 8.3; Dividend yield: 0.5%; TSINetwork Rating: Average; www.apple.com) gets about half of its revenue from iPhone sales....

1 min read

Pat McKeough

Growth Stocks

Price hikes unlikely to hurt demand

MONDELEZ INTERNATIONAL INC. $64 is a buy. The company (Nasdaq symbol MDLZ; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 1.4 billion; Market cap: $89.6 billion; Price-to-sales ratio: 3.1; Dividend yield: 2.2%; TSINetwork Rating: Above Average; www.mondelezinternational.com) makes cookies and crackers (Oreo, Ritz), chocolate bars (Cadbury, Toblerone), gum and candy (Trident, Dentyne) and Halls cough drops.

Like other foodmakers, Mondelez is seeing higher costs for ingredients and transportation....

1 min read

Pat McKeough

Growth Stocks

Infrastructure spending spurs these spinoffs

Carrier has soared 258% and Otis is up 86% since Raytheon Technologies Corp. (New York symbol RTX), formerly United Technologies (old symbol UTX) spun them off in April 2020. For each UTX share they held, investors received 0.5 of a share in Otis and 1 share in Carrier.

Both spinoffs should continue to move higher over the next few years, particularly as the new U.S....

2 min read

Pat McKeough

Growth Stocks

High p/e offsets its bright outlook

IDEXX LABORATORIES INC. $624 is still a hold. The company (Nasdaq symbol IDXX; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 84.8 million; Market cap: $52.9 billion; Price-to-sales ratio: 16.8; No dividends paid; TSINetwork Rating: Average; www.idexx.com) makes equipment that veterinarians use to detect diseases in pets and farm animals.

In the third quarter of 2021, sales rose 12.3%, to $810.4 million from $721.8 million a year earlier....

1 min read

Pat McKeough

Growth Stocks

Remote-working trend supports their growth

Adobe and Fair Isaac have moved down after hitting record highs in 2021. However, demand for their products remains strong, particularly as employees continue to work from home during the pandemic.

ADOBE INC. $558 is buy. The company (Nasdaq symbol ADBE; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 475.8 million; Market cap: $265.5 billion; Price-to-sales ratio: 18.0; No dividends paid since June 2005; TSINetwork Rating: Average; www.adobe.com) makes software that lets computer users create, edit and share documents in the popular PDF format....

2 min read

Pat McKeough

Growth Stocks

Starbucks’ higher wages to pay off

STARBUCKS CORP. $110 remains a buy for aggressive investors. The company (Nasdaq symbol SBUX; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 1.2 billion; Market cap: $132.0 billion; Price-to-sales ratio: 4.8; Dividend yield: 1.8%; TSINetwork Rating: Above Average; www.starbucks.com) is a leading seller and roaster of specialty coffee....

1 min read

Pat McKeough

Growth Stocks

These two can handle future lockdowns

Concerns that the Omicron variant of COVID-19 will lead to new lockdowns have hurt the stock prices of these two fast-food companies. However, their customers continue to embrace online ordering and home delivery, which should spur their long-term earnings.

YUM! BRANDS INC....

2 min read

Pat McKeough

Growth Stocks

Profit from crypto with much less risk

Instead of investing directly in cryptocurrencies, such as bitcoin, we prefer companies like Visa and PayPal that will profit from processing crypto transactions. Both firms also stand to gain from the ongoing shift to electronic payments.

VISA INC....

2 min read

Pat McKeough

Testimonials

The cornerstones of Pat’s strategy–value, diversification and timelines–make his newsletter, The Successful Investor, highly profitable while minimizing risk. His advice is no-nonsense, down-to-earth and based on solid research. You’ll know what to invest in and what to avoid.

Chuck Chakrapani, PhD
Investors Association of Canada
The older I get the better dividends look. For retirees and would-be retirees who want to sleep at night, I can’t think of a better source of information on reliable growing dividend income than Pat McKeough’s newsletter, Dividend Advisor.

Jonathan Chevreau
Financial Post Columnist
As a manager of more than $500 million in mutual funds, I have access to the best brokerage research available in this country. But I still take time to read Pat McKeough’s premium newsletters

John Sartz
I appreciate the 25 years of above market returns I received by following your advice. at least 95% of my investment decisions were based on TSI recommendations.

Chuck J.
Subscriber since 1996. Inner Circle Member Since 2006
The newsletters I receive in Inner Circle Pro are fantastic! I have been following Pat’s advice for years and everything he has said has been amazing. His commentaries are brilliant, insightful, educational, rational and balanced. My returns are almost double the TSE and I have referred many of my friends who have switched over to your services.

Walter H.
Inner Circle Pro subscriber

Browse Premium Topics

Cannabis

Spinoffs

One of the ways a company can try to unlock its own hidden value is by creating a separate company out of a corporate subsidiary. The parent company can either sell stock in the new company to the public, or spin it off—hand the stock out to its own investors.

Dividend Stocks

Dividend stocks make cash payouts that serve as a way for companies to share the wealth they’ve accumulated. These payouts are drawn from earnings and cash flow and paid to the shareholders of the company. Typically, these dividends are paid quarterly, although they may be paid annually or even monthly as well.

ETFs

What are ETFs?

ETF is an acronym for exchange traded fund. These exchange traded funds are used to track indexes as closely as possible, since investors cannot actually buy an index outright.

Value Stocks

What are value stocks?

One of the sweetest and most profitable pleasures of successful investing is to buy high-quality “value stocks” (or stocks that are reasonably priced, if not cheap, in relation to its sales, earnings or assets), then hold on to them as mainstream investors recognize the value and push up the share price.

Blue Chip Stocks

Blue chip stocks are big, well-established, dividend-paying corporations with strong business prospects. These are companies that also have sound management that should be able to make the right moves to keep competing successfully in a changing marketplace.

Penny Stocks

A penny stock in general trades for under five dollars a share, and as the name implies, sometimes for pennies. Most of the time they’re young companies, or start-ups in speculative markets like mining or technology.

Growth Stocks

Wealth Management

Wealth management is the practice of putting your savings to work so that it continues to grow over your lifetime and will also benefit your heirs. Wealth management encompasses many different areas of investing like long term investment planning and retirement planning.

Mining Stocks

Mining stocks are investments in companies that produce or explore for minerals. Some of these minerals include uranium, coal, molybdenum (which is used in steelmaking), copper, silver and gold. They are affected by fluctuating commodity prices in addition to their own business and operating risks.

How To Invest

Pat McKeough has been making investing for beginners simple—and profitable—by helping investors make big gains for more than 25 years. His advice to beginning investors is the same as it is for all investors: buy high-quality, mostly dividend paying stocks (or ETFs that hold these stocks) and evenly spread your investments over the five main economic sectors (Resources, Manufacturing, Finance, Utilities and Consumer). Pat also believes investors should avoid stocks in the broker/media limelight and focus on those with hidden or little-noticed assets.

Energy Stocks

What are energy stocks?

Businesses that work in the extraction, refining and delivery of energy sources such as natural gas, oil, uranium and coal, are considered energy stocks.