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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Growth Stocks Library Archives
AGT FOOD & INGREDIENTS $36.46 (Toronto symbol AGT; TSINetwork Rating: Extra Risk) (604-231-1100; www.agtfoods.com; Shares outstanding: 23.9 million; Market cap: $840.7 million; Dividend yield: 1.7%) buys, processes and distributes a range of pulses—peas, beans, lentils and chickpeas—as well as other specialty crops. Based in Saskatchewan, the company owns 13 processing plants in Canada, nine in Turkey, four in Australia, two in the U.S., one in China and another in South Africa. In the three months ended March 31, 2016, AGT’s cash flow per share jumped to $0.83 from $0.37 a year earlier. Revenue gained 14.6%, to $441.4 million from $385.2 million. The increases stem from the company’s expanded processing and recent acquisitions, including short-line railways and bulk-loading facilities in Saskatchewan....
INTACT FINANCIAL $88.33 (Toronto symbol IFC; TSINetwork Rating: Extra Risk) (416-341-1464; www.intactfc.com; Shares outstanding: 131.3 million; Market cap: $11.6 billion; Dividend yield: 2.6%) is Canada’s largest provider of property and casualty insurance. Intact dropped to as low as $85 from about $92 after the wildfires at Fort McMurray, Alberta. Investors were worried about the company’s exposure to residential damage claims. However, the impact on the insurer is very manageable. It now expects to take a charge of about $1.00 to $2.00 per share ($130 million to $160 million). To put that in perspective, it made $5.20 a share ($706 million) in 2015....
CHEMTRADE LOGISTICS INCOME FUND $17.58 (Toronto symbol CHE.UN; TSINetwork Rating: Speculative) (416-496-5856; www.chemtradelogistics .com; Units outstanding: 69.1 million; Market cap: $1.2 billion; Dividend yield: 6.8%) is one of North America’s largest providers of removal services for oil refineries, base metal processors and other firms creating by-products such as acids and sulphur. Chemtrade converts these substances to useful chemicals like sulphuric acid. It then sells these to customers in a variety of industries. In the three months ended March 31, 2016, the trust’s revenue rose 3.1%, to $336.1 million from $326.0 million a year earlier. The gain mainly came from the lower Canadian dollar, which increased the value of Chemtrade’s sales in the U.S. Cash flow fell 6.8%, to $42.3 million, or $0.61 a share, from $45.4 million, or $0.66 a share. Temporary problems at two of the company’s suppliers pushed up production costs for its chemicals....
WEIGHT WATCHERS INTERNATIONAL $13.25 (New York symbol WTW; TSINetwork Rating: Extra Risk) (212-589-2700; www.weightwatchers.com; Shares outstanding: 63.6 million; Market cap: $852.8 million; No dividends paid) has increased its membership for the first time in four years. The number of active subscribers stood at 3.06 million on April 2, 2016. That’s a 4.8% rise from 2.92 million a year ago. Oprah Winfrey bought 10% of the company in October 2015. Her goal has been to promote it and help reverse its steady decline over the last decade. She has appeared in advertisements for Weight Watchers since late last year and used social media to share her experiences with its lifestyle programs. Winfrey has also used emails and conference calls to interact with others on the plan....
FIRSTSERVICE CORP. $58.14 (Toronto symbol FSV; TSINetwork Rating: Extra Risk) (416-960-9500; www.firstservice.com; Shares outstanding: 34.7 million; Market cap: $2.1 billion; Dividend yield: 1.0%) completed the spinoff of its commercial real estate business—Colliers International Group—on June 2, 2015. Now that the split is complete, FirstService is carrying on with its residential property management and its commercial and residential property-improvement services. In the first quarter ended March 31, 2016, the company’s revenue rose 13.0%, to $307.6 million from $272.2 million a year earlier (all figures except share price in U.S. dollars)....
DOREL INDUSTRIES $33.69 (Toronto symbol DII.B; TSINetwork Rating: Extra Risk) (514-934-3034; www.dorel.com; Shares outstanding: 32.3 million; Market cap: $1.1 billion; Dividend yield: 4.6%) is up over 19% after reporting sharply higher profits in the latest quarter. In the three months ended March 31, 2016, sales fell 2.9%, to $645.9 million from $665.5 million a year earlier (all figures except share price in U.S. dollars). However, excluding one-time items, Dorel’s earnings per share jumped 66.7%, to $0.61 a share from $0.37. The improved profit comes from falling costs as the company moves production of its strollers and other baby items from North America and Europe to China. Investments in its ecommerce operations are also paying off, especially for its distribution network....
ACI WORLDWIDE $19.41 (Nasdaq symbol ACIW; TSINetwork Rating: Speculative) (402-390-7600; www.aciworldwide.com; Shares outstanding: 119.1 million; Market cap: $2.3 billion; No dividends paid) makes software for processing transactions through credit cards, debit cards, automated teller machines, point-of-sale terminals and interbank systems. Its products also work to cut fraud. The company’s more than 5,000 customers include 1,000 of the world’s largest financial institutions and 300 leading global retailers. Together, they process payments of over $14 trillion daily. In the three months ended March 31, 2016, ACI made $0.75 a share, compared to $0.02 a year earlier. However, those recent earnings include the company’s $0.77 gain on the sale of its Community Financial Services business for $200 million. Excluding that transaction, the company lost $0.02 a share....
BROADRIDGE FINANCIAL $63.18 (New York symbol BR; TSINetwork Rating: Average) (201-714-3000; www.broadridge.com; Shares outstanding: 118.8 million; Market cap: $7.3 billion; Dividend yield: 1.9%) serves the investment industry in two main areas: investor communications, and securities processing and transaction clearing. It handles 90% of all proxy votes in the U.S. and Canada. In the three months ended March 31, 2016, Broadridge’s earnings per share rose 23.4%, to $0.58 from $0.47. Revenue also improved. It gained 8.6%, to $688.8 million from $634.2 million. While the company continues to attract new clients, it’s holding on to existing ones. That’s pushing up sales and profits—and pushing the stock to all-time highs....
HECLA MINING COMPANY $4.12 (New York symbol HL; TSINetwork Rating: Extra Risk) (208-769- 4100; www.hecla-mining.com; Shares o/s: 380.8 million; Market cap: $1.8 billion; Dividend yield: 0.2%) explores for, mines and processes silver and gold in the U.S. and Mexico. Most of the company’s silver output comes from three sites: the Greens Creek mine in Alaska; the Lucky Friday project in Idaho; and the San Sebastian mine in Mexico. Hecla’s Casa Berardi mine in Quebec, which it bought for $796 million in June 2013, supplies its gold. In the three months ended March 31, 2016, Hecla’s gold output rose 36.7%, to 55,688 ounces from 40,650. It produced 4.6 million ounces of silver—up 61.3% from 2.9 million a year earlier. The rise came from higher ore grades at its mines, as well as output from its new San Sebastian mine in Mexico....
CAMECO CORP. $14.91 (Toronto symbol CCO; TSINetwork Rating: Extra Risk) (306- 956-6200; www.cameco.com; Shares outstanding: 395.8 million; Market cap: $6.0 billion; Dividend yield 2.7%) is the world’s biggest uranium producer. It has large, high-grade reserves, lowcost operations and several mining sites. Cameco has now closed its Rabbit Lake mine in northern Saskatchewan. The company made the decision because of falling uranium prices and excess supply on global markets. Uranium prices have plunged from an already low $35 U.S. a pound in January 2016 to $27 today. Rabbit Lake has been in operation since 1975, and contributed about 14% of Cameco’s uranium output in 2015....