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.
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CALIAN GROUP, $76.30, is a buy. The stock (Toronto symbol CGY; TSINetwork Rating: Extra Risk) (calian.com; Shares outstanding: 11.4 million; Market cap: $869.8 million; Dividend yield: 1.5%) lets investors tap the Ottawa-based company’s four main operating segments:
Even as the pandemic eased, the gains continued as the company introduced more products and expanded its software offerings. Today, ResMed’s outlook remains attractive—and not solely because of its CPAP machines.
We think this Power Buy is poised to move even higher for you.
ALIMENTATION COUCHE-TARD, $83.47, is a buy. This retailer (Toronto symbol ATD; TSINetwork Rating: Average) (couchetard.com; Shares o/s: 925.8 million; Market cap: $77.3 billion; Yield: 1.0%) operates 14,637 convenience stores, mostly in North America and Europe.
METRO INC. $95 is a buy. The company (Toronto symbol MRU; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 213.2 million; Market cap: $20.3 billion; Price-to-sales ratio: 0.9; Dividend yield: 1.7%; TSINetwork Rating: Average; www.metro.ca) operates 1,007 food stores in Quebec and Ontario under several banners, including Metro, Food Basics and Super C. It also has 637 drugstores in Quebec, Ontario and New Brunswick under the Jean Coutu, Brunet, Metro Pharmacy and Food Basics Pharmacy banners.
SAPUTO INC. $42 is a hold. The company (Toronto symbol SAP; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 407.0 million; Market cap: $17.1 billion; Price-to-sales ratio: 0.9; Dividend yield: 1.9%; TSINetwork Rating: Average; www.saputo.com) is Canada’s largest producer of dairy products. It also operates dairies in the U.S., Australia, the U.K. and Argentina.