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

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:

ADOBE INC., $371.94, is a buy. The company’s (Nasdaq symbol ADBE; TSINetwork Rating: Average) (www.adobe.com; Shares outstanding: 468.0 million; Market cap: $175.8 billion; No dividends paid) decision a few years ago to switch to selling its programs as ongoing subscriptions instead of one-time purchases continues to pay off for investors: In the three months ended June 3, 2022, Adobe’s revenue rose 14.4%, to a record $4.39 billion from $3.84 billion.

Earnings climbed 10.6%, to $3.35 a share from $3.03 a year earlier.

Adobe also spends a high 18% of its sales on research to stay ahead of the competition and add to its market share....

1 min read

Pat McKeough

Growth Stocks

Twilio adds Canada for growth

TWILIO INC., $85.09, is a buy. The company (Nasdaq symbol TWLO; TSINetwork Rating: Extra Risk) (www.twilio.com; Shares outstanding: 171.9 million; Market cap: $15.2 billion; No dividends paid) has now officially entered the Canadian market....

1 min read

Pat McKeough

Growth Stocks

High R&D spending will power their gains

We think the drug 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 drug company to another. A volatile market like the one we expect for drug stocks will include winners and losers....

2 min read

Pat McKeough

Growth Stocks

1Life may consider a takeover offer

We like 1Life’s outlook: we think the company will keep attracting corporations, and their employees, in this largely untapped market. That will push up returns for investors in this high-growth firm. Meantime, the chance of a takeover bid adds to the stock’s appeal.

1LIFE HEALTHCARE, $9.70, is a buy. The company (Nasdaq symbol ONEM; TSINetwork Rating: Extra Risk) (www.onemedical.com; Shares o/s: 194.0 million; Market cap: $1.9 billion; No divd.) is a membership-based provider of primary health care through its One Medical technology platform....

1 min read

Pat McKeough

Growth Stocks

Couche-Tard preps for an EV future

Alimentation Couche-Tard not only adapted to the pandemic—it thrived. And now, looking ahead, the company has set up the first test of an electric vehicle (EV) charger at one of its U.S. stores. Notably, Couche-Tard is the only convenience-store player with a major footprint in Norway, the global leader in EV sales....

2 min read

Pat McKeough

Growth Stocks

Updating your Aggressive stocks: Shawcor, Nutrien & Toromont Industries

SHAWCOR LTD. $5.21 (www.shawcor.com) remains a buy. The company makes sealants and coatings that keep oil and gas pipelines from rusting. It also manufactures industrial products, such as electrical wire and protective sheaths, as well as fiberglass-reinforced plastic underground tanks to store fuel and wastewater....

1 min read

Pat McKeough

Growth Stocks

Thomson continues to unlock value

Thomson Reuters has held up well during the current downturn—the stock is up 10% in the past year compared to the 8% decline for the S&P/TSX Composite Index. That’s partly because it’s using the proceeds from the sale of its financial information business (Refinitiv) to raise its dividend and buy back shares....

2 min read

Pat McKeough

Growth Stocks

Rising air travel volumes will spur CAE

Airlines are now spending more on simulators and pilot training as travel volumes return to pre-pandemic levels. That’s good news for CAE, which has about 30% of the pilot-training market. The company also continues to expand its military businesses; that cuts its exposure to the cyclical airline industry....

2 min read

Pat McKeough

Growth Stocks

Loblaw adds a big facility

LOBLAW COMPANIES, $114.01, is a buy. The company (Toronto symbol L; Shares outstanding: 328.1 million; Market cap: $37.5 billion; TSINetwork Rating: Above Average; Dividend yield: 1.4%; www.loblaw.ca) is Canada’s largest food retailer, with 1,096 supermarkets....

1 min read

Pat McKeough

Growth Stocks

Updating your Conservative stocks: Diageo, Motorola Solutions and Canon

DIAGEO PLC ADR $175 (www.diageo.com) is still a hold. The U.K.-based maker of premium alcoholic beverages has suspended exports to Russia in response to its invasion of Ukraine....

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.