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
REITMANS (CANADA) LTD., $7.48, symbol RET.A on Toronto, shot up over 15% this week after reporting a return to profitability in the latest quarter. Reitmans owns 823 women’s clothing stores across Canada, including 341 Reitmans stores, 139 Penningtons, 105 Addition Elle, 76 RW & Co., 68 Thyme Maternity and 94 Smart Set locations. It also has 21 Thyme Maternity boutiques in some Canadian Babies “R” Us locations. In the three months ended January 31, 2015, Reitmans’ sales fell 1.8%, to $236.3 million from $240.7 million a year earlier. Sales declined because the company closed 55 less-profitable stores. Same-store sales gained 2.1%....
PLEASE NOTE: Our next Hotlines will go out on Friday, April 10, 2015. PHILIPS ELECTRONICS N.V. ADRs, $29.30, New York symbol PHG, is selling most of its light emitting diode (LED) components and automotive lighting division (which is changing its name to Lumileds) to private equity firm GO Scale Capital. Under the deal, Philips will sell 80.1% of Lumileds for $2.9 billion. That’s equal to 11% of its $26.6-billion market cap (or the value of all of its outstanding shares). Philips expects to complete the sale in the third quarter of 2015....
PLEASE NOTE: Our next Hotline will go out on Friday, April 10, 2015. HECLA MINING CO., $3.18, symbol HL on New York, explores for, mines and processes silver and gold in the U.S. and Mexico. This week, the company agreed to buy Revett Mining Company (symbol RVM on New York) for $20 million in Hecla shares....
PLEASE NOTE: Due to the Good Friday holiday, our next Hotline will go out on Thursday, April 2, 2015. ATLANTIC TELE-NETWORK, $70.37, symbol ATNI on Nasdaq, owns wireless and wireline telecom operations in the U.S. Southwest, New England, New York State, Guyana, Bermuda and parts of the Caribbean islands. The company continues to improve its technology and expand its wireless capacity and coverage. That’s paying off as customers use more mobile data for profitable services like music downloads, mobile gaming and e-books....
PLEASE NOTE: Due to the Good Friday holiday, our next Hotline will go out on Thursday, April 2, 2015. KRAFT FOODS GROUP INC., $89.10, Nasdaq symbol KRFT, jumped 40% this week after agreeing to merge with rival food maker H.J. Heinz. The new firm—The Kraft Heinz Company—will be North America’s third-largest food and beverage company and fifth-biggest in the world. It will have $28 billion of annual revenue, including eight brands with over $1 billion in yearly sales....
FedEx’s stock has risen 80% since the start of 2013. That’s mainly because more consumers are shopping online, which has translated into more packages for the company’s delivery services. Companies are also relying on its just-in-time shipping services to cut their inventory costs and increase their efficiency. We feel FedEx has lots more growth ahead. And its recent costcutting plan— combined with falling fuel costs— will spur its earnings for years to come. FEDEX CORP. $165 (New York symbol FDX; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 283.8 million; Market cap: $46.8 billion; Price-to-sales ratio: 1.0; Dividend yield: 0.5%; TSINetwork Rating: Average; www.fedex.com) began offering air-delivery services in 1973, under the Federal Express banner. It’s now one the world’s largest shipping firms....
You will soon see the results of a major upgrade to the design, functionality and performance of our TSI Network website (www.tsinetwork.ca). Rather than simply make cosmetic changes to the site we launched in 2009, we have taken advantage of the latest technology and our own growth as a company to give the site an advanced redesign. As a subscriber you will immediately see significant improvements....
Both GE and ABB (see box) are selling less important assets to concentrate on their main industrialequipment businesses. That should improve their earnings and cut their risk. GENERAL ELECTRIC CO. $25 (New York symbol GE; Conservative Growth and Income Portfolios, Manufacturing & Industry sector; Shares outstanding: 10.1 billion; Market cap: $252.5 billion; Price-to-sales ratio: 1.7; Dividend yield: 3.7%; TSINetwork Rating: Above Average; www.ge.com) makes machinery for power generation and distribution (such as turbines) and other products, like jet engines, medical equipment, appliances, lighting and locomotives. The company continues to shrink GE Capital, which mainly provides loans to GE’s clients. In 2014, this business supplied 42% of the company’s operating earnings, but it aims to cut that to 25% by 2016....
ABB LTD. ADRs $21 (New York symbol ABB; Conservative Growth Portfolio, Manufacturing & Industry sector; ADRs outstanding: 2.3 billion; Market cap: $48.3 billion; Price-to-sales ratio: 1.2; Dividend yield: 3.7%; TSINetwork Rating: Above Average; www.abb.com) makes transformers, transmission systems and circuit breakers for electrical utilities. The Switzerland-based firm also produces automation systems and robotics that industrial clients use to improve their productivity. As part of a new plan to focus on its main operations, ABB sold several small businesses for a total of $1.1 billion in 2014. As well, the company is focusing on power projects with strong potential and turning down risky, less profitable orders. At the same time, a restructuring plan, including plant closures and job cuts, saved the company a further $1.1 billion in 2014. Partly due to asset sales, ABB’s revenue fell 4.8% in 2014, to $39.8 billion from $41.8 billion in 2013. However, orders for new equipment rose 6.7%, to $41.5 billion from $38.9 billion....
The three companies below make testing gear that other manufacturers rely on to improve their products. As well, all three have built strong relationships with their clients, which gives them a strong competitive advantage. Still, only one is a buy right now. AGILENT TECHNOLOGIES INC. $41 (New York symbol A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 336.0 million; Market cap: $13.8 billion; Price-to-sales ratio: 2.0; Dividend yield: 1.0%; TSINetwork Rating: Average; www.agilent.com) has completed its plan to split into two publicly traded companies. One firm kept the Agilent name and stock symbol and focuses on testing equipment for medical research labs. It gets 70% of its revenue from overseas....