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

New firm off to a good start

TELUS INTERNATIONAL (CDA) INC. $40 is a buy for aggressive investors. The company (Toronto symbol TIXT; Aggressive Growth Portfolio; Manufacturing sector; Shares outstanding: 266.0 million; Market cap: $10.6 billion; Price-to-sales ratio: 3.4; No dividend paid; TSINetwork Rating: Average: Lowest; www.telusinternational.com) operates call centres on behalf of over 600 corporate clients in 28 countries....

1 min read

Pat McKeough

Growth Stocks

Aggressive stocks play an important role

Stock market volatility tends to have a larger impact on aggressive investments. However, we continue to believe that most investors can benefit from holding a portion of their well-diversified portfolios in these higher-risk stocks.

Even so, as a way of cutting your risk, we prefer higher-risk companies that are leaders in their markets....

5 min read

Pat McKeough

Growth Stocks

Long-term trends favour Nutrien

Nutrien shot up to a record high of $147.93 in April 2022 following Russia’s invasion of Ukraine and the imposition of economic sanctions; the near-global ban on Russian goods lifted prices for potash and other fertilizers. Still, the stock has dropped lately as producers outside of Russia increase supply to meet demand.

Over the longer term, Nutrien should continue to benefit as an expanding world population needs more and better food....

4 min read

Pat McKeough

Growth Stocks

Use these updates to enhance your returns

HONDA MOTOR CO. LTD. ADRs $27 is a buy. The automaker (New York symbol HMC; Conservative Growth Portfolio, Manufacturing & Industry sector; ADRs outstanding: 1.7 billion; Market cap: $45.9 billion; Price-to-sales ratio: 0.4; Divd. yield: 3.9%; TSINetwork Rating: Above Average; www.honda.com) sold 71,235 vehicles in the U.S....

2 min read

Pat McKeough

Growth Stocks

Supply chain delays add to GE’s risk

GENERAL ELECTRIC CO. $77 remains a hold. The conglomerate (New York symbol GE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.1 billion; Market cap: $84.7 billion; Price-to-sales ratio: 1.1; Dividend yield: 0.4%; TSINetwork Rating: Average; www.ge.com) plans to break itself up into three separate companies: GE HealthCare (X-ray equipment, MRI and ultrasound scanners); GE Vernova (renewable energy and power); and GE Aerospace (jet engines and aircraft electronics)....

1 min read

Pat McKeough

Growth Stocks

Rising input costs add to their risk

The easing of the pandemic and rising industrial activity are spurring the shares of Howmet and Arconic. However, rising prices for raw materials and labour will hold back their earnings for the next year or two.

HOWMET AEROSPACE INC. $38 is a hold. The company (New York symbol HWM; Manufacturing & Industry sector; Shares outstanding: 415.4 million; Market cap: $15.8 billion; Price-to-sales ratio: 2.9; Dividend yield: 0.2%; TSINetwork Rating: Average; www.howmet.com) makes a range of industrial parts, from jet engine components and fasteners to forged aluminum wheels.

On April 1, 2020, the old Arconic Inc....

2 min read

Pat McKeough

Growth Stocks

Re-opening lifts Lamb Weston

LAMB WESTON HOLDINGS INC. $82 is a buy. The company (New York symbol LW, Income Portfolio, Consumer sector; Shares o/s: 143.7 million; Market cap: $11.8 billion; Price-to-sales ratio: 2.9; Divd. yield: 1.2%; TSINetwork Rating: Average; www.lambweston.com) is a leading producer of frozen french fries and other packaged vegetables.

Thanks to the re-opening of restaurants and higher selling prices, the company’s sales in its fiscal 2022 fourth quarter, ended May 29, 2022, rose 14.5%, to $1.15 billion from $1.01 billion a year earlier....

1 min read

Pat McKeough

Growth Stocks

Stronger earnings spur buybacks

ARCHER DANIELS MIDLAND CO. $89 is a buy. The company (New York symbol ADM; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 560.6 million; Market cap: $49.9 billion; Price-to-sales ratio: 0.5; Dividend yield: 1.8%; TSINetwork Rating: Above Average; www.adm.com) processes corn, wheat, soybeans, flax seed and other crops into a variety of food ingredients such as flour, oils and sweeteners....

1 min read

Pat McKeough

Growth Stocks

Legacy techs still have long-term appeal

The recent market downturn has hit technology stocks especially hard. Their inherent volatility is why we advise investors to stick with well-established tech firms with popular products and services, such as Apple, Microsoft and Intel. All of them remain in a strong position to quickly rebound with the overall market....

5 min read

Pat McKeough

Growth Stocks

eBay adds a new platform

EBAY INC. $46 is a buy for aggressive investors. The company (Nasdaq symbol EBAY; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 549.4 million; Market cap: $25.3 billion; Price to-sales ratio: 2.7; Dividend yield: 1.9%; TSINetwork Rating: Above Average; www.ebay.com) operates e-commerce websites, in over 190 countries, where sellers pay fees to auction items or offer them at fixed prices.

The company is now buying TCGplayer; it operates an e-commerce platform that lets users buy and sell collectible trading cards based on popular games such as Pokémon, Yu-Gi-Oh! and Magic: The Gathering.

eBay will pay $295 million for this business when it completes the purchase in early 2023....

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.