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
AMAZON.COM $217.47 (Nasdaq symbol AMZN; TSINetwork Rating: Extra Risk) (206- 266-1000; www.amazon.com; Shares outstanding: 450.5 million; Market cap: $98.0 billion; No dividends paid) has reportedly agreed to buy 3-D mapping company UpNext. UpNext offers interactive, threedimensional maps. Users can “drop down” into streets and tap objects to bring up information, directions or different viewpoints. Offering its own mapping capability through UpNext will let Amazon take full advantage of rising demand for mobile ads. As well, the company may be working on a smartphone, and it could use UpNext on that device....
ADOBE SYSTEMS $31.43 (Nasdaq symbol ADBE; TSINetwork Rating: Average) (408-536-6000; www.adobe.com; Shares outstanding: 491.8 million; Market cap: $15.5 billion; No dividends paid) is teaming up with NBC to stream events live from the Olympic Summer Games in London to mobile device users in the U.S. for free. Comcast Corp. owns NBC, which has the U.S. television rights to the London Olympics. NBC has launched two applications using Adobe technology. Both include software that measures user traffic and offers targeted advertising. The first app, NBC Olympics Live Extra, will let customers of cable, satellite and telephone companies live-stream competitions and events. The other app, called NBC Olympics, will provide additional information, such as TV and online schedules, live results and highlights....
ALIMENTATION COUCHE-TARD $48.37 (Toronto symbol ATD.B: TSINetwork Rating: Extra Risk) (1-800-361-2612; www.couche-tard.com; Shares outstanding: 179.4 million; Market cap: $8.7 billion; Dividend yield: 0.6%) has reported sharply higher sales and earnings in the latest quarter. In the three months ended April 29, 2012, Couche-Tard’s earnings per share rose 88.6%, to $0.66 from $0.35 a year earlier (all figures except share price in U.S. dollars). Sales rose 28.0%, to $6.1 billion from $4.7 billion. The gains came from higher fuel prices, acquisitions and higher merchandise sales. The company gets about 30% of its sales by selling merchandise....
INTUITIVE SURGICAL $549.36 (Nasdaq symbol ISRG; TSINetwork Rating: Average) (515-507-5000; www.intuitivesurgical.com; Shares outstanding: 39.7 million; Market cap: $21.8 billion; No dividends paid) makes the da Vinci, a computerized surgical system. Guided by a miniature camera connected to a 3-D monitor, surgeons use the da Vinci to operate by remotely manipulating tiny robotic arms. This process is safer and much less invasive than regular surgery, and helps cut a patient’s recovery time and post-operative discomfort. It also reduces scarring and infection risk. In the three months ended March 31, 2012, Intuitive earned $143.5 million, or $3.63 a share. That’s up 37.8% from $104.1 million, or $2.66 a share, a year earlier. Revenue rose 27.6%, to $495.2 million from $388.1 million. Intuitive is debt-free, and holds cash of $2.4 billion, or $60.45 a share....
ALCOA INC., $8.42, New York symbol AA, reported better-than-expected revenue and earnings this week. Even so, the aluminum producer’s shares fell 4%. In the three months ended June 30, 2012, Alcoa earned $61 million, or $0.06 a share. These figures exclude several unusual items, such as costs related to a fire at one of its smelters and a $45-million offer to settle a lawsuit from an aluminum producer in Bahrain. Alcoa warned that it might have to pay an extra $75 million to settle this suit, which accuses the company of overcharging for raw materials. On this basis, the latest earnings beat the consensus estimate of $0.05 a share. A year earlier, Alcoa earned $326 million, or $0.28 a share....
ALIMENTATION COUCHE-TARD, $48.20, symbol ATD.B on Toronto, reported sharply higher sales and earnings in the latest quarter. The company is the largest convenience store operator in Canada, with over 2,000 outlets. It also has nearly 3,700 U.S. stores. The Canadian stores operate under the Couche-Tard and Mac’s banners, while the U.S. stores mainly use the Circle K brand. In the three months ended April 29, 2012, Couche-Tard’s earnings jumped 82.6%, to $117.8 million from $64.2 million a year earlier (all figures except share price in U.S. dollars). Earnings per share rose 88.6%, to $0.66 from $0.35, on fewer shares outstanding....
FORD MOTOR CO., $9.50, New York symbol F, reports that its U.S. sales rose 7.0% in June 2012, to 207,759 vehicles from 194,114 in June 2011. That was higher than the consensus estimate of a 4.4% rise. The company recently launched a new version of its Escape sport utility vehicle. That helped spur a 24.8% jump in Ford’s overall SUV sales. Truck sales rose 1.2%, while sales of passenger cars rose 0.3%. The company also warned that its overseas operations would probably lose $570 million (before taxes) in the second quarter of 2012, mainly because the uncertain European economy is hurting its sales on the continent. These businesses had a pre-tax loss of $190 million in the first quarter....
NEW GOLD INC., $9.95, symbol NGD on Toronto, has three operating mines: the Mesquite mine in the U.S., the Cerro San Pedro mine in Mexico and the Peak mine in Australia. It also owns 30% of the El Morro copper/gold project in Chile (Goldcorp owns the other 70%) and 100% of the Blackwater gold project in B.C. New Gold is now starting up its fourth mine. The $765-million New Afton gold mine in B.C. processed the first ore through its mill on June 28, 2012. New Gold’s target for commercial production at New Afton, defined as 30 days of operation at 60% capacity (or 6,600 tonnes per day) remains August 2012. The company expects New Afton to produce an average of 85,000 ounces of gold and 75 million pounds of copper annually over its 12-year life. There is still room to expand the mine’s reserves and increase production through exploration drilling....
GOOGLE INC., $580.07, Nasdaq symbol GOOG, will soon launch the Nexus 7, a new tablet computer that features a 7-inch touch-screen display and the latest version of the company’s Android operating system for mobile devices. The new tablet will cost $199. That should help Google complete with similar-sized tablets, including Amazon.com’s popular Kindle Fire. (Amazon.com is a recommendation of Stock Pickers Digest, our newsletter that focuses on aggressive investing.) Google will also launch the Nexus Q, a ball-shaped device that lets users stream music and video from the Internet to a TV set or stereo system. This device will cost $299....
MART RESOURCES, $1.36, symbol MMT on Toronto, jumped over 28% this week after the company declared a special dividend of $0.10 a share, payable on August 8, 2012. Mart will then begin paying quarterly dividends of $0.05 a share starting in September 2012. The stock is now up 288.6% since we first recommended it in our May 2010 issue at $0.35. Mart is focused on developing, producing and drilling for oil at its properties in Africa. The company is currently producing oil at its 50%-held Umusadege field in Nigeria....