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
CHEMTRADE LOGISTICS INCOME FUND $14.03 (Toronto symbol CHE.UN; TSINetwork Rating: Speculative) (416-496-5856; www.chemtradelogistics.com; Units outstanding: 30.7 million; Market cap: $430.3 million; Dividend yield: 8.8%) is one of North America’s largest providers of removal services for resource firms, such as oil refineries and base-metal processors. These companies create sulphur, acid and other by-products as part of their processing activities. Chemtrade converts these by-products into useful chemicals, like sulphuric acid. It also makes chemicals, such as sodium chlorate. In the three months ended December 31, 2010, Chemtrade’s cash flow per unit fell 31.7%, to $0.28 from $0.41 a year earlier. However, the decline was mostly because a fire forced Chemtrade to shut down its plant in Beaumont, Texas. High distribution appears safe ...
PLEASE NOTE: Our next Hotline will go out on Thursday, April 21, 2011. ALCOA INC., $16.52, New York symbol AA, fell 8% this week after the aluminum maker reported lower-than-expected sales in the first quarter of 2011. In the three months ended March 31, 2011, Alcoa’s sales rose 21.9 %, to $6.0 billion from $4.9 billion a year earlier. Even so, the latest sales fell short of the consensus estimate of $6.1 billion....
PLEASE NOTE: Our next Hotline will go out on Thursday, April 21, 2011. AMAZON.COM INC., $180.01, symbol AMZN on Nasdaq, plans to sell the latest version of its Kindle portable e-book reader for just $114, which is $25 less than the previous version. To make up for the price cut, the company will display ads as screen savers and in a banner at the bottom of the home screen. It will also offer special deals to users, such as those at Groupon or other daily “best deal” web sites. Amazon introduced its Kindle portable e-book reader for $399 in 2007. Later models have become slimmer and cheaper, with better displays and more memory. The new model is expected to go on sale in U.S. at Target and Best Buy stores, as well as on Amazon’s web site, on May 3, 2011....
PLEASE NOTE: Our next Hotline will go out on Friday, April 15, 2011. TEXAS INSTRUMENTS INC., $35.24, New York symbol TXN, is buying rival chipmaker National Semiconductor Corp. (New York symbol NSM) in a friendly takeover. Texas Instruments is paying $6.5 billion, which is equal to 15% of its $42.1-billion market cap. It held cash of just $3.1 billion at the end of 2010. However, the company is debt free, so it has plenty of room to borrow the money it needs to complete this purchase....
PLEASE NOTE: Our next Hotline will go out on Friday, April 15, 2011. NEW GOLD INC., $10.81, symbol NGD on Toronto, has agreed to buy Richfield Ventures (symbol RVC on Toronto) for $550 million in New Gold shares. New Gold holds cash of $491 million, or $1.25 a share, so it could use some of those funds for the purchase. However, its shares are trading near their all-time highs, so the company decided to use its stock instead....
PLEASE NOTE: Our next Hotline will go out on Thursday, April 7, 2011. EBAY INC., $31.36, Nasdaq symbol EBAY, is buying GSI Commerce Inc. (Nasdaq symbol GSIC) which sells e-commerce services to over 500 businesses. GSI’s customers include major retailers, such as Toys R Us and Aeropostale, consumer-electronics makers, including Hewlett-Packard, and professional-sports leagues, such as the National Football League. GSI helps these clients process and fulfill online orders, and increase their online sales....
PLEASE NOTE: Our next Hotline will go out on Thursday, April 7, 2011. AMAZON.COM INC., $180.13, symbol AMZN on Nasdaq, has announced a new service, called Amazon Cloud Player, that lets users upload their music to an Amazon server and play it through any web browser, or on smartphones or tablet computers that use Google’s Android operating system. This way, users don’t have to download music to their computers or smartphones and then transfer it to other devices. Cloud Player users get 5 gigabytes of storage for free. That’s enough for about 1,000 songs. Users who buy music MP3 files from Amazon’s online music store will get 20 gigabytes for free for one year....
AT&T INC., $28.85, New York symbol T, has agreed to buy T-Mobile from Germany’s Deutsche Telekom AG. T-Mobile is the fourth-largest provider of wireless services in the U.S., with 33.7 million subscribers. Adding T-Mobile would make AT&T the largest wireless carrier in the U.S., with 130 million subscribers. This is huge purchase for AT&T, which will pay $39 billion for T-Mobile. That’s equal to 23% of its $170.5-billion market cap. AT&T will pay $25 billion in cash, and the remaining $14 billion in stock. That would give Deutsche Telekom an 8% stake in AT&T....
ALIMENTATION COUCHE-TARD, $25.54, symbol ATD.B on Toronto, is the largest convenience store operator in Canada, with over 2,000 outlets. It also has over 3,500 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. The fuel pumps at most stores provide 68% of the company’s sales. In the three months ended January 30, 2011, Couche-Tard’s earnings rose 29.6%, to $71.0 million, or $0.38 a share, from $54.8 million, or $0.29 a share, a year earlier (all figures except share prices in U.S. dollars). The latest earnings beat the consensus estimate of $0.37 a share. Revenue rose 13.7%, to $5.6 billion from $4.9 billion. Same-store merchandise sales climbed 3.9% in the U.S., and 0.4% in Canada. U.S. sales make up 77.9% of total sales....
We’ve often pointed out that spinoffs like Agilent tend to perform better than comparable stocks in the first few years. Agilent shot up to $162 after it became an independent company in 1999. However, it dropped below $11 when the tech-stock boom ended in 2002. It rose to $40 in 2007, but fell back to $12 in 2009. Even with its erratic history, Agilent still outperformed larger tech stocks, such as Microsoft, Intel, Cisco Systems and its former parent, Hewlett-Packard. Agilent’s recent shift into medical-testing products should give it more predictable earnings, and make the stock less volatile. As well, demand for its electronic-testing products is rising with the economy. AGILENT TECHNOLOGIES INC. $44 (New York symbol A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 345.1 million; Market cap: $15.2 billion; Price-to-sales ratio: 2.6; No dividends paid; TSINetwork Rating: Average; www.agilent.com) makes testing systems that help improve electronic products, such as cellphones and computer-networking equipment....