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.
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Growth Stocks Library Archives
ENERFLEX LTD., $18.86, symbol EFX on Toronto, rents and sells equipment and services for natural gas production, including compression and processing plants, refrigeration equipment and power generators. The stock jumped over 12% this week after Enerflex announced that it will acquire two businesses owned by privately held Axip Energy Services LP: an international contract compression and processing subsidiary and a division that provides aftermarket services. Enerflex will pay $430 million U.S. in cash. The agreement includes operations in Mexico, South America, Southeast Asia and the Middle East, but not Axip’s U.S. business. The major assets that Enerflex will receive include a 448-unit compression fleet totalling about 285,000 horsepower, all of which are operating under long-term rental contracts. This equipment is currently 90% utilized and has an average age of 5.5 years. Enerflex also gets gas-treating facilities in Mexico, Argentina and Peru....
GOODYEAR TIRE & RUBBER, $26.37, symbol GT on New York, is the world’s largest tire maker, with 51 plants in 22 countries. This week, the company announced that it will build a new tire plant in either North or South America. The facility will produce six million tires a year and help Goodyear meet rising demand for high-performance tires in both regions. Goodyear expects to spend $500 million on this facility, which could start up in 2017. To put that in context, Goodyear’s 2013 cash flow was $407.0 million....
HILLSHIRE BRANDS CO., $53.28, New York symbol HSH, jumped 18% this week in response to two hostile takeover offers. The company makes a variety of packaged meat products. Its main brands include Ball Park hot dogs, Jimmy Dean sausages and Hillshire Farm deli meats. Other foods include Sara Lee frozen desserts and Chef Pierre pies. On Tuesday, rival food producer Pilgrim’s Pride Corp. (Nasdaq symbol PPC) offered to acquire Hillshire for $45.00 a share. That was followed by a $50.00-a-share bid by Tyson Foods (New York symbol TSN) on Thursday....
In February 2014, Microsoft replaced Steve Ballmer, its longtime chief executive officer, with Satya Nadella, who previously headed up the company’s profitable server software division.
Since then, the stock has gained 12%. That’s mainly because Mr. Nadella plans to focus on the fast-growing mobile and cloud markets....
Since then, the stock has gained 12%. That’s mainly because Mr. Nadella plans to focus on the fast-growing mobile and cloud markets....
GOOGLE INC. $562 (Nasdaq symbol GOOG; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 674.5 million; Market cap: $379.1 billion; Price-to-sales ratio: 6.1; No dividends paid; TSINetwork Rating: Above Average; www.google.com) recently handed out its new class C non-voting shares to its class A (one vote per share) and class B (10 votes per share) shareholders....
Businesses will likely spend more on software this year, as the global economy continues to recover. That’s good news for these market leaders, but Symantec’s focus on security puts it in a better position to benefit as more companies adopt cloud computing. ADOBE SYSTEMS INC. $65 (Nasdaq symbol ADBE; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 497.7 million; Market cap: $32.4 billion; Price-to-sales ratio: 8.3; No dividends paid since June 2005; TSINetwork Rating: Average; www.adobe.com) earned $151.3 million, or $0.30 a share, in its fiscal 2014 first quarter, which ended February 28, 2014. That’s down 14.9% from $177.9 million, or $0.35, a year ago. Revenue fell 0.8%, to $1.00 billion from $1.01 billion. The declines are mainly because Adobe is now selling its Creative Cloud package of photo-editing and desktop-publishing programs as a subscription instead of a one-time purchase. That hurts the company’s short-term growth, but it should provide stable revenue streams as more users switch over. Subscriptions now supply over half of Adobe’s revenue....
NVIDIA CORP. $19 (Nasdaq symbol NVDA; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 558.0 million; Market cap: $10.6 billion; Price-to-sales ratio: 2.6; Yield: 1.8%; TSINetwork Rating: Average; www.nvidia.com) earned $166.1 million in the quarter ended April 27, 2014....
Sales are slowing at these three beverage makers, mainly because health-conscious consumers are cutting back on sugary drinks and alcohol. Even so, we feel their well-known brands will continue to help them prosper. They’re also doing a good job of cutting their costs, which is freeing up additional cash for acquisitions and dividends. However, in light of their recent gains, only one is a buy right now. PEPSICO INC. $87 (New York symbol PEP; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 1.5 billion; Market cap: $130.5 billion; Price-to-sales ratio: 2.0; Dividend yield: 3.0%; TSINetwork Rating: Above Average; www.pepsico.com) is the world’s second-largest soft drink maker after Coca-Cola. It also makes other products, such as Frito-Lay snack foods, Gatorade sports drinks, Tropicana fruit juices and Quaker Oats cereals....
CHEVRON CORP. $123 (New York symbol CVX; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.9 billion; Market cap: $233.7 billion; Price-to-sales ratio: 1.1; Dividend yield: 3.5%; TSINetwork Rating: Above Average; www.chevron.com) plans to increase production at its Permian shale oil properties in west Texas by two-thirds, to 250,000 barrels a day, by 2020....
ARCHER DANIELS MIDLAND CO., $44 (New York symbol ADM; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 654.5 million; Market cap: $28.8 billion; Price-to-sales ratio: 0.3; Dividend yield: 2.2%; TSINetwork Rating: Above Average; www.adm.com) processes corn, wheat, soybeans, canola, flax seed, peanuts, cocoa and other crops into a wide variety of food ingredients, such as flour, oils and sweeteners....