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

ShawCor sheds its legacy business

SHAWCOR LTD. $18 remains a buy for aggressive investors. The company (Toronto symbol MATR; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 70.5 million; Market cap: $1.3 billion; Price-to-sales ratio: 0.9; Dividend suspended in March 2020; TSINetwork Rating: Average; www.mattr.com) has completed a strategic review of its pipeline coating division, which operates under the ShawCor brand.

Note—as part of its re-organization, ShawCor plans to change its legal name to Mattr Infratech....

1 min read

Pat McKeough

Growth Stocks

Use our updates to enhance your portfolio

HOME CAPITAL GROUP INC. (Toronto symbol HCG) is a mortgage lender serving borrowers who fail to meet the stricter standards of Canada’s traditional lenders. Smith Financial Corp. has now completed its takeover of the company. As a result, Home Capital’s shares stopped trading on the Toronto exchange on August 31, 2023.

Home Capital shareholders received $44.28 a share in cash....

2 min read

Pat McKeough

Growth Stocks

Rising backlog cuts your risk

CGI INC. $140 is your #1 Aggressive Buy for 2023. The company (Toronto symbol GIB.A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 235.5 million; Market cap: $33.0 billion; Price-to-sales ratio: 2.4; No dividends paid; TSINetwork Rating: Extra Risk; www.cgi.com) is Canada’s largest provider of computer-outsourcing services.

Thanks to its strong reputation, CGI continues to win new contracts....

1 min read

Pat McKeough

Growth Stocks

Railways set to rebound from port strike

These two railways recently re-routed some of their traffic due to the B.C. port workers strike. The strike has now ended, which should let them recover those added costs over the next few months.

CANADIAN PACIFIC KANSAS CITY LTD. $106 is your #1 Conservative Buy for 2023. The company (Toronto symbol CP; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 931.5 million; Market cap: $98.7 billion; Price-to-sales ratio: 9.6; Dividend yield: 0.7%; TSINetwork Rating: Above Average; www.cpkcr.com) took its current form on April 14, 2023, when Canadian Pacific Ltd....

2 min read

Pat McKeough

Growth Stocks

This new firm still has long-term appeal

In February 2021, Telus Corp. (Toronto symbol T) set up its business services unit International as a separate, publicly traded company. The new firm’s shares are now down 65% since the initial public offering. That’s mainly because many of its larger clients, particularly in the technology industry (contributing 45% of its revenue), are spending less on its services....

2 min read

Pat McKeough

Growth Stocks

RBI brings Popeyes to China

RESTAURANT BRANDS INTERNATIONAL INC. $92 is a buy for aggressive investors. The company (Toronto symbol QSR, Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 452.0 million; Market cap: $41.6 billion; Price-to-sales ratio: 4.5; Dividend yield: 3.3%; TSINetwork Rating: Average; www.rbi.com) has 30,125 fast-food outlets in over 100 countries: 18,935 Burger King, 5,662 Tim Hortons (coffee and donuts), 4,269 Popeyes Louisiana Kitchen (fried chicken) and 1,259 Firehouse Subs.

Earlier this year, TH International Limited (Nasdaq symbol THCH), called “Tims China”, became the exclusive operator and developer of the Popeyes brand in mainland China.

As a result, Tims China recently opened its flagship restaurant in Shanghai....

1 min read

Pat McKeough

Growth Stocks

AQN ponders a split

ALGONQUIN POWER & UTILITIES, $10.26, is a buy. The utility (Toronto symbol AQN; Shares outstanding: 688.8 million; Market cap: $7.1 billion; TSINetwork Rating: Extra Risk; Dividend yield: 5.7%; www.algonquinpower.com) has two main businesses: the Regulated Services Group provides regulated electricity, gas, water distribution and wastewater collection services in Canada, the U.S., Chile and Bermuda; and the Renewable Power Group produces electricity from about 47 clean-energy plants in North America.

Algonquin is now conducting a strategic review of its renewable power operations....

1 min read

Pat McKeough

Growth Stocks

Two blue-chip leaders with gains ahead

BCE and Metro are leading competitors in their respective markets; look for that to cut your ongoing risk. We see both as buys.

BCE INC., $57.66, is a buy. The company (Toronto symbol BCE; Shares o/s: 912.3 million; Market cap: $52.7 billion; TSINetwork Rating: Above Average; Yield: 6.7%) is Canada’s largest traditional telephone service provider....

2 min read

Pat McKeough

Growth Stocks

Becton moves beyond COVID

BECTON DICKINSON & CO. $277 is a buy. The company (New York symbol BDX; Conservative Growth Portfolio, Manufacturing sector; Shares outstanding: 283.9 million; Market cap: $78.6 billion; Price-to-sales ratio: 4.2; Dividend yield: 1.3%; TSINetwork Rating: Above Average; www.bd.com) makes a variety of medical devices, including stents, catheters, needles, incontinence devices and surgical tools.

In its fiscal 2023 third quarter, ended June 30, 2023, Becton’s revenue rose 5.1%, to $4.88 billion from $4.64 billion a year earlier....

1 min read

Pat McKeough

Growth Stocks

Still vulnerable to cheaper brands

DIAGEO PLC ADR $169 is a hold. The company (New York symbol DEO; Conservative Growth Portfolio, Consumer sector; ADRs outstanding: 562.5 million; Market cap: $95.1 billion; Price-to-sales ratio: 4.4; Dividend yield: 2.2%; TSINetwork Rating: Above Average; www.diageo.com) is a leading maker of premium alcoholic beverages.

In the fiscal year ended June 30, 2023, Diageo’s sales rose 10.7%, to 17.11 billion British pounds (1 pound = $1.67 Canadian) from 15.45 billion pounds in 2022....

1 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.