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

Power your gains with these tech leaders

Broadridge’s clients are mostly big corporations, while NortonLifeLock targets the consumer market. But both have winning business models that we expect will lead to strong growth in future years. We recommend Broadridge as a Power Buy and NortonLifeLock as a buy.

BROADRIDGE FINANCIAL SOLUTIONS, $177.63, is a buy. The company (New York symbol BR; TSINetwork Rating: Average) (www.broadridge.com; Shares o/s: 117.2 million; Market cap: $20.8 billion; Divd....

2 min read

Pat McKeough

Growth Stocks

PaperDuty is a battle-tested IPO we recommend

One Successful Investor way to cut IPO risk is to wait till a new issue has survived a market slump. April 2019 IPO PagerDuty dropped to near $13 in March 2020 as COVID-19 took hold. But its business has continued to prosper by applying artificial intelligence (AI) to help its customers shorten or avoid disruptions and to save money. We recommend this stock as a Power Buy.

PAGERDUTY INC., $27.15, is a buy. The company (New York symbol PD; TSINetwork Rating: Extra Risk) (www.pagerduty.com; Shares o/s: 87.8 million; Market cap: $2.5 billion; No dividends paid) operates a platform that collects real-time data from software systems and devices and then notifies its IT customers of any incident that could harm their operations.

For the three months ended April 30, 2022, revenue rose 34.3%, to $85.4 million from $63.6 million a year earlier....

1 min read

Pat McKeough

Growth Stocks

Here are updates on two of your buys

Long-time readers know that we keep you informed of important news about the stocks we cover. That means highlighting developments and plans that promise to brighten prospects for investors. Here are two buys that stand out this month:

BOSTON SCIENTIFIC CORP., $42.43, is a buy. The company (New York symbol BSX; TSINetwork Rating: Average) (bostonscientific.com; Shares o/s: 1.4 billion; Market cap: $60.3 billion; No divds.) develops and markets medical devices used in minimally invasive procedures.

In the quarter ended June 30, 2022, Boston Scientific’s revenues rose 5.4%, to $3.24 billion from $3.08 billion a year earlier.

Excluding one-time items, the company earned $635.0 million, or $0.44 a share, in the quarter....

2 min read

Pat McKeough

Growth Stocks

This pizza maker doesn’t need Italy

DOMINO’S PIZZA, $411.99 (New York symbol DPZ; TSINetwork Rating: Average) (www.dominos.com; Shares o/s: 35.9 million; Market cap: $14.8 billion; Yeld: 1.1%), still has lots of room for international expansion. However, Italy will not be part of that growth, at least for now....

1 min read

Pat McKeough

Growth Stocks

Healthcare leaders set to thrive post-COVID

We think the healthcare industry will enjoy great success over the next decade. But due to the nature of the business, results will vary widely and unpredictably from one company to another. A volatile market like the one we expect for healthcare stocks will include winners and losers....

2 min read

Pat McKeough

Growth Stocks

ADT ‘s outlook is bright

ADT INC., $8.02, is a buy. The company (New York symbol ADT; TSINetwork Rating: Extra Risk) (adt.com; Shares o/s: 856.7 million; Market cap: $7.5 billion; Yield 1.8%) is a leading provider of monitored security products and services to residential and commercial customers in the U.S....

1 min read

Pat McKeough

Growth Stocks

Amazon expands in robotics

AMAZON.COM INC., $142.10, is a buy. The company (Nasdaq symbol AMZN; TSINetwork Rating: Average) (www.amazon.com; Shares o/s: 10.2 billion; Market cap: $1.5 trillion; No divds.) is now buying Roomba maker iRobot Corp. (symbol IRBT on Nasdaq) for $1.7 billion in cash.

iRobot has an estimated 75% of the U.S....

1 min read

Pat McKeough

Growth Stocks

Short-term challenges won’t derail Shopify

Despite its current challenges, Shopify’s long-term outlook remains sound. The company has been expanding its business in recent years to provide more services for merchants. It has developed point-of-sale hardware for retailers, launched a shopping app for its merchants to list products and created a network of fulfillment centres to ship orders for its business partners.

SHOPIFY INC., $48.13, remains a buy. The company (Toronto symbol SHOP; TSINetwork Rating: Extra Risk) (www.shopify.ca; Shares o/s: 1.2 billion; Market cap: $64.6 billion; No dividends paid) is now eliminating roughly 1,000 jobs, or 10% of its global workforce.

Shopify feels the layoffs are necessary as consumers resume old shopping habits and pull back from the online ordering that fuelled its recent rapid growth....

1 min read

Pat McKeough

Growth Stocks

ResMed expands in a lucrative niche

ResMed continues to prosper in its CPAP machine market but is also expanding quickly in out-of-hospital software solutions. These are aimed at letting healthcare agencies work more efficiently to provide individualized service to patients. This is a big growth area, and ResMed’s progress here bodes well for its share price and for its investors.

We still believe in this leader’s strong prospects and its outlook....

2 min read

Pat McKeough

Growth Stocks

Sales rebound as stores re-open

RESTAURANT BRANDS INTERNATIONAL INC. $77 is a buy. The company (Toronto symbol QSR, Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 449.1 million; Market cap: $34.6 billion; Price-to-sales ratio: 4.5; Dividend yield: 3.6%; TSINetwork Rating: Average; www.rbi.com) is the world’s third-largest fast-food operator after McDonald’s (No....

1 min read

Pat McKeough

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Investors Association of Canada
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Subscriber since 1996. Inner Circle Member Since 2006
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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.