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.

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Growth Stocks Library Archives

Growth Stocks

Spinoff and parent keep prospering

FIRSTSERVICE CORP. $86.33 (Toronto symbol FSV; TSINetwork Rating: Extra Risk) (416-960-9500; www. firstservice.com; Shares outstanding: 34.6 million; Market cap: $3.1 billion; Dividend yield: 0.8%) set up its commercial real estate business, Colliers International Group, as a separate company on June 1, 2015....

2 min read

Pat McKeough

Growth Stocks

Sales drive FICO’s profit

FAIR ISAAC CORP. $163.72 (New York symbol FICO; TSINetwork Rating: Average) (415-472- 2211; www.fairisaac.com; Shares outstanding: 30.1 million; Market cap: $4.8 billion; No dividends paid) reports that in its first quarter ended December 31, 2017, revenue rose 7.2%, to $235.3 million from $219.6 million a year earlier.

The company earned $41.1 million, or $1.30 a share, in the latest quarter....

1 min read

Pat McKeough

Growth Stocks

These restaurants face different risks

RESTAURANT BRANDS INTERNATIONAL $57.71 (New York symbol QSR; TSINetwork Rating: Average) (905-845-6511; www.rbi.com; Shares o/s: 478.0 million; Market cap: $27.6 billion; Divd. yield: 3.1%) is the world’s third-largest fast-food operator after McDonald’s (No....

2 min read

Pat McKeough

Growth Stocks

WYN set to expand

WYNDHAM WORLDWIDE $121.67 (New York symbol WYN; TSINetwork Rating: Extra Risk) (973-753-6000; www.wyndhamworldwide. com; Shares outstanding: 101.3 million; Market cap: $12.0 billion; Dividend yield: 1.9%) will now buy the hotel franchise and management businesses of La Quinta Holdings, symbol LQ on New York, for $1.95 billion.

Under the terms of the deal, Wyndham will acquire La Quinta’s hotel franchise and management business after La Quinta spins off its real-estate assets as CorePoint Lodging Inc.

The La Quinta acquisition adds the management of 900 hotels to Wyndham’s portfolio....

1 min read

Pat McKeough

Growth Stocks

Here’s our Pick of the Month

BROADRIDGE FINANCIAL SOLUTIONS $97.34 New York symbol BR; TSINetwork Rating: Average) (201-714-3000; www.broadridge.com; Shares outstanding: 116.6 million; Market cap: $11.1 billion; Dividend yield: 1.5%) serves the investment industry in three main areas: investor communications, securities processing and transaction clearing.

Investor communications makes up 72% of its overall revenue....

1 min read

Pat McKeough

Growth Stocks

Home Capital’s outlook still cloudy

HOME CAPITAL GROUP INC. $16 (Toronto symbol HCG; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 80.3 million; Market cap: $1.3 billion; Price-to-sales ratio: 4.1; Dividend suspended in May 2017; TSINetwork Rating: Speculative; www.homecapital.com) is a mortgage lender serving borrowers who fail to meet the stricter standards of Canada’s big banks and other larger, traditional lenders.

The stock is down 6% since the start of 2018....

1 min read

Pat McKeough

Growth Stocks

Metro tests new ways to lower costs

METRO INC. $40 (Toronto symbol MRU; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 227.1 million; Market cap: $9.1 billion; Price-to-sales ratio: 0.7; Dividend yield: 1.8%; TSINetwork Rating: Average; www.metro.ca) operates 590 grocery stores and 250 drugstores, in Quebec and Ontario.

Rising minimum wages will probably add $35 million to $45 million to Metro’s costs for the current fiscal year; it earned $153.4 million, or $0.67 a share, in the quarter ended December 23, 2017.

In response, Metro is now testing a new automated checkout system that let shoppers scan items as they put them in their shopping cart and pay as they leave the store....

1 min read

Pat McKeough

Growth Stocks

Smart buys add to CGI’s appeal

We recently selected CGI Group as our top Aggressive stock pick for 2018. That’s mainly because we feel it is in a strong position to profit as more businesses and governments outsource their increasingly complex computing functions to specialists like CGI.

The company also has an ambitious plan to double its size in the next few years, probably through acquisitions....

4 min read

Pat McKeough

Growth Stocks

Strong growth lies ahead for these leaders

CANADIAN PACIFIC RAILWAY $227.74 (Toronto symbol CP; shares outstanding: 147.7 million; Market cap: $33.7 billion; TSINetwork Rating: Above Average; Dividend yield: 1.0%; www.cpr.ca) ships freight over a 22,000-kilometre rail network between Montreal and Vancouver, with links to hubs in the U.S.

In the quarter ended December 31, 2017, revenue rose 4.6%, to $1.71 billion from $1.64 billion a year earlier....

2 min read

Pat McKeough

Growth Stocks

Updating Restaurant Brands International Inc., Cintas Corp. and Idexx Laboratories Inc.

RESTAURANT BRANDS INTERNATIONAL INC. $62 (www.rbi.com) operates 16,253 Burger King, 4,680 Tim Hortons (coffee and donuts) and 2,809 Popeyes Louisiana Kitchen (fried chicken) outlets. Those fast-food locations are spread across 100-plus countries. An ongoing feud between the company and its Tim Hortons franchisees threatens to dampen sales and earnings growth....

1 min read

Pat McKeough

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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.