Volatility is certainly on the rise in the markets these days, but some growth stocks still remain. Companies that have a business that isn’t locked into interest rate moves or remains detached from typical business cycles or is in mega-trend growth sectors that will make them ‘flight to safety’ stocks will remain worthy buys.
And even if these seven A-rated growth stocks for Q4 are pulled down in a broad market selloff they will simply be better bargains, not stocks to dump as things go down a bit. These are leaders in their respective sectors and have the unique ability to grow through whatever comes. They’re both technically strong and fundamentally strong.
This market is getting skittish of what the Federal Reserve plans on doing in the coming quarter. If it raises rates, it may push the economy into recession. If it stays the course, it risks inflation that it can’t get under control. And doing nothing may not be the best choice, either.
And there’s the fact that other nations are still trying to prime their economies, which complicates matters even more.
Avoid all this and stick with these seven growth stocks to buy that are strong enough to endure regardless of macro issues.
Growth Stocks to Buy: Smith & Wesson Holding Corp (SWHC)
Smith & Wesson Holding Corp (NASDAQ:SWHC) is the iconic gun maker.
And after rolling up a 20% gain year-to-date, the good news keeps rolling in.
Remember, this is an election year and one of the major candidates is promising to get tough on gun ownership regulations.
That spurs gun owners to go out and buy all the guns they can between now and the election in November. And the numbers that are coming back show that background checks are growing at double-digit rates. That means gun applications are continuing to grow.
Also, SWHC recently reported a fantastic quarter (fiscal year 17 Q1). Net income for the quarter was up 126% year-over-year. Revenue was up 40% year-over-year. And this doesn’t even take into account that hunting season will be in full swing in the coming weeks across the country, which will drive sales, as will the holidays.
Growth Stocks to Buy: China Lodging Group, Ltd (ADR) (HTHT)
China Lodging Group, Ltd (ADR) (NASDAQ:HTHT) is China’s most dynamic lodging development and management company. And its continued growth is assured for two main reasons.
First, it is completely de-linked from other global economies. This domestic China firm is literally building the Chinese hotel industry. And given the rise in China’s middle class — which continues, albeit at a slower pace — travel for both pleasure and business will continue to grow organically.
Second, HTHT is on the vanguard of a trend that it hitting the entire hotel sector around the world. In the U.S., retailers are seeing hotels as a great way to sell products. They can build a hotel with their products in the lobby and rooms and then they hire a management company to run the hotel.
In China, there are still plenty of companies simply looking to get into the hotel business and will have China Lodging Group manage their properties. But the fact is that HTHT is just at the beginning of this growth megatrend.
Growth Stocks to Buy: Fair Isaac Corporation (FICO)
Fair Isaac Corporation (NYSE:FICO) has been in the financial data analytics sector since 1956.
About 2.5 billion credit cards are protected by its Fraud Systems division. And 95% of the largest financial institutions in the U.S. work with FICO.
That in and of itself is a pretty compelling reason to like Fair Isaac stock. However, there’s another aspect to its business in recent years that has really landed FICO on the growth track: credit scores.
Fair Isaac is the leading company for credit scores, aka FICO scores. To-date more than 100 billion credit scores have been sold, and 75% of U.S. home loan originations rely on FICO scores. And this doesn’t even take into account the new mobile-based markets, where millennials are checking their credit scores more than Facebook accounts, thanks to free credit score sites like CreditKarma.com.
And Fair Isaac is already delivering, growing earnings nearly 70% from year-ago levels, according to its latest quarterly report in late July. The stock is up 10% in the last three months.
Growth Stocks to Buy: Ubiquiti Networks Inc (UBNT)
Ubiquiti Networks Inc (NASDAQ:UBNT) is in a great space in the tech world. It specializes in building out network technology — from networking, to security, to broadband to wireless local area networks — for enterprise businesses.
Because the word ‘enterprise’ gets tossed around a lot, it’s important to know what it means these days. Basically, enterprise businesses are simply mid-sized to large businesses with hundreds or thousands of employees. Some small businesses may get into this definition, but most of the terms and conditions are built for companies with cash in the bank and relatively complex systems.
This is good for UBNT, because this is the sector of the economy that is strong. The big companies are the ones sitting on piles of cash. And what’s more, they’re looking to maximize the productivity of their workforce as well as their outreach.
UBNT stock is up nearly 70% YTD, and that kind of growth is still in its future as well.
Growth Stocks to Buy: Berry Plastics Group Inc (BERY)
Berry Plastics Group Inc (NYSE:BERY) is one of the nation’s leading manufacturers of films, tapes and plastic packaging.
That may not sound too exciting, but there are some industries where if you’re good at what you do, and you are meeting a growing need, you can make a lot of money. And that is where BERY is.
Think about going about your everyday life. Get some cereal for breakfast — the film that holds the cereal in the box is a product. Wrap a sandwich for lunch in plastic wrap or use a plastic bag. Throw a load of wash in and pour out the detergent — another plastic container. And throw away your trash in a plastic trash bag. You get the point.
BERY makes all these under its own labels as well as private labels. And the demand is growing, not diminishing.
Perhaps that’s why Berry is up over 20% in the last 6 months. And the fact that it’s not sexy means it will keep bad investors out of it.
Growth Stocks to Buy: Baxter International Inc (BAX)
Baxter International Inc (NYSE:BAX) goes all the way back to the Great Depression. In 1931, two doctors got together and became the first company to develop and sell intravenous solutions commercially. Before that, only hospitals and university health centers made their own solutions and so they were never available for broader use.
Since those days, BAX has stuck close to its knitting. It’s still a leader in the IV space as well as other fundamental healthcare applications. One of its most significant additions has been its renal portfolio for people with kidney disease or kidney failure.
What’s more, BAX has been in Asian markets for four decades now. That is a big competitive advantage, especially in China, where many companies have been ‘Johnny-come-latelys’ to China and the Chinese value long-term relationships and cooperation. Asia is where the healthcare boom will hit next.
The stock is up nearly 25% YTD and it is far from its potential.
Growth Stocks to Buy: Facebook Inc (FB)
Facebook Inc (NASDAQ:FB) needs little introduction. As the largest social media company on the planet, it has a very secure position.
But in times like the current ones, FB is a great choice because it’s detached from the economic ups and downs that affect other companies of its size.
You see, 95% of Facebook revenue comes from advertising. And given the fact that online advertising is expected to double in the next 4 years to $120 billion, FB doesn’t have to worry about rising interest rates or a weakening dollar — or anything.
Facebook is integrating all its social media platforms, so they’re cross functional. That’s nice for users, but it’s great for advertisers and FB. It means Facebook can sell advertising packages across Facebook, WhatsApp, Instagram and Messenger, providing a multiplier effect to FB’s bottom line.
The stock is up more than 40% in the last 12 months, and that kind of growth is likely to continue for the foreseeable future.
Louis Navellier is a renowned growth investor. He is the editor of five investing newsletters: Blue Chip Growth, Emerging Growth, Ultimate Growth, Family Trust and Platinum Growth. His most popular service, Blue Chip Growth, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters.