Growth Stocks

Growth stocks are companies that are likely to have sales and earnings growth well above market average. Frequently they pay few, if any, dividends. Instead they typically reinvest any extra cash flow to promote further growth. Chosen wisely—according to Pat McKeough’s advice—high-quality growth-oriented stocks can be worthwhile additions to most well-diversified portfolios.

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

Growth Stocks

These two have more growth ahead

In April 2020, we promoted real-estate service providers FirstService and Colliers from Power Growth Investor to The Successful Investor, our flagship newsletter.

Since then, FirstService has gained 57%. That’s largely because homeowners have continued to upgrade their properties even after the pandemic....

4 min read

Pat McKeough

Growth Stocks

Updating your Aggressive stocks: RioCan, SNC-Lavalin & Leon

RIOCAN REAL ESTATE INVESTMENT TRUST $18 (www.riocan.com) is a buy. The REIT owns all or part of 193 shopping centres and other properties across Canada, as well as 11 projects under development. RioCan plans to spend between $400 million and $450 million on new developments in 2023....

1 min read

Pat McKeough

Growth Stocks

Loblaw aims for growth

LOBLAW COMPANIES, $117.58, is a buy. The retailer (Toronto symbol L; Shares outstanding: 315.2 million; Market cap: $36.9 billion; TSINetwork Rating: Above Average; Dividend yield: 1.5%; www.loblaw.ca) continues to expand its growth initiatives.

A key part of its growth plan is its financial services business (3% of revenue), which offers banking services, insurance and credit cards....

1 min read

Pat McKeough

Growth Stocks

Illinois Tool Works is a solid manufacturing bet on the global economy

Illinois Tool Works continues to report rising revenues and earnings including a 48.9% earnings jump in the most recent quarter.

2 min read

Pat McKeough

Growth Stocks

Updating your Conservative stocks: PepsiCo, International Business Machines & Sony Group

PEPSICO INC. $170 (www.pepsico.com) is still a hold. The company is the world’s second-largest soft-drink maker after Coca-Cola. The stock has moved down lately on speculation that Burger King fast-food outlets in India (about 390 stores) will end their 10-year alliance with PepsiCo in favour of a new deal with Coca-Cola....

1 min read

Pat McKeough

Growth Stocks

This chipmaker has strong rebound potential

Shares of Texas Instruments are down slightly since the start of 2023. That’s largely because manufacturers stocked up on chips due to pandemic-related supply chain disruptions. We expect orders will increase as customers use up their inventories. The company is also taking advantage of tax credits under the U.S....

2 min read

Pat McKeough

Growth Stocks

Acquisition should boost earnings

LAMB WESTON HOLDINGS INC. $91 is a buy. The company (New York symbol LW, Income Portfolio, Consumer sector; Shares o/s: 145.7 million; Market cap: $13.3 billion; P-to-S ratio: 2.5; Divd. yield: 1.2%; TSINetwork Rating: Average; www.lambweston.com) is a leading producer of frozen french fries, potatoes and other packaged vegetables.

In February 2023, Lamb Weston paid $564.0 million for the 50% interest in its joint venture with Netherlands-based Meijer Frozen Foods B.V....

1 min read

Pat McKeough

Growth Stocks

Lack of new cars is good news for these two

It’s likely that the strikes at the big three American car makers will hurt the supply of new vehicles. As well, rising interest rates are making it more expensive for consumers to finance new car purchases. These factors should spur demand for replacement parts and repair services at both Genuine Parts and Snap-On....

2 min read

Pat McKeough

Growth Stocks

Howmet’s high p/e adds risk

HOWMET AEROSPACE INC. $46 is a hold. The company (New York symbol HWM; Conservative Growth Portfolio, Manufacturing sector; Shares outstanding: 413.3 million; Market cap: $19.0 billion; Price-to-sales ratio: 3.1; Dividend yield: 0.3%; TSINetwork Rating: Average; www.howmet.com) makes a range of industrial parts, from jet engine components and fasteners to forged aluminum wheels.

Revenue in the second quarter of 2023, rose 18.3%, to $1.65 billion from $1.39 billion a year earlier....

1 min read

Pat McKeough

Growth Stocks

Three ways to tap a construction boom

The re-opening of the world’s economy in the wake of the COVID-19 lockdown spurred strong demand for building construction services and infrastructure projects. Here are three high-quality stocks to help you benefit from it.

CARRIER GLOBAL CORP....

5 min read

Pat McKeough

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Browse Premium Topics

Cannabis

Spinoffs

One of the ways a company can try to unlock its own hidden value is by creating a separate company out of a corporate subsidiary. The parent company can either sell stock in the new company to the public, or spin it off—hand the stock out to its own investors.

Dividend Stocks

Dividend stocks make cash payouts that serve as a way for companies to share the wealth they’ve accumulated. These payouts are drawn from earnings and cash flow and paid to the shareholders of the company. Typically, these dividends are paid quarterly, although they may be paid annually or even monthly as well.

ETFs

What are ETFs?

ETF is an acronym for exchange traded fund. These exchange traded funds are used to track indexes as closely as possible, since investors cannot actually buy an index outright.

Value Stocks

What are value stocks?

One of the sweetest and most profitable pleasures of successful investing is to buy high-quality “value stocks” (or stocks that are reasonably priced, if not cheap, in relation to its sales, earnings or assets), then hold on to them as mainstream investors recognize the value and push up the share price.

Blue Chip Stocks

Blue chip stocks are big, well-established, dividend-paying corporations with strong business prospects. These are companies that also have sound management that should be able to make the right moves to keep competing successfully in a changing marketplace.

Penny Stocks

A penny stock in general trades for under five dollars a share, and as the name implies, sometimes for pennies. Most of the time they’re young companies, or start-ups in speculative markets like mining or technology.

Growth Stocks

Wealth Management

Wealth management is the practice of putting your savings to work so that it continues to grow over your lifetime and will also benefit your heirs. Wealth management encompasses many different areas of investing like long term investment planning and retirement planning.

Mining Stocks

Mining stocks are investments in companies that produce or explore for minerals. Some of these minerals include uranium, coal, molybdenum (which is used in steelmaking), copper, silver and gold. They are affected by fluctuating commodity prices in addition to their own business and operating risks.

How To Invest

Pat McKeough has been making investing for beginners simple—and profitable—by helping investors make big gains for more than 25 years. His advice to beginning investors is the same as it is for all investors: buy high-quality, mostly dividend paying stocks (or ETFs that hold these stocks) and evenly spread your investments over the five main economic sectors (Resources, Manufacturing, Finance, Utilities and Consumer). Pat also believes investors should avoid stocks in the broker/media limelight and focus on those with hidden or little-noticed assets.

Energy Stocks

What are energy stocks?

Businesses that work in the extraction, refining and delivery of energy sources such as natural gas, oil, uranium and coal, are considered energy stocks.