Earnings growth is always a good sign that company is on the right track. And that’s especially true of firms who aren’t seeing their earnings grow because management is buying back stock.
Earnings are simply a company’s profitability. But that number can sliced and diced a number of different ways. And stock buyback are an easy way to juice earnings and nowadays. You see, the Street doesn’t really care how companies are boosting earnings, just that they’re serious about doing it.
Here are 10 high-growth stock to kick your portfolio into hyper drive in part because their earnings are on the rise in the best way possible. They’re seeing more business and they’re on the growth track.
Many are also top players in key strategic sectors that should see some quality long-term expansion as the global economy continues its recovery.
High-Growth Stocks to Buy: Alibaba (BABA)
Alibaba Group Holding Ltd (NYSE:BABA) is the 800-pound gorilla of the Chinese online and mobile companies. Its $485 billion market cap puts it in contention with top U.S. players in the sector like Amazon.com, Inc. (NASDAQ: AMZN) and Alphabet Inc (NASDAQ:GOOG, NASDAQ:GOOGL).
But BABA has a significantly larger market base in which to expand, a growing middle class and the blessing of the state to do so.
What’s more, BABA is also becoming very active in India through joint ventures with Indian gaming companies.
After a nearly 100% run in the past 12 months, BABA stock is just getting started.
High-Growth Stocks to Buy: Lowe’s (LOW)
Lowe’s Companies, Inc. (NYSE:LOW) is a home improvement store with more nearly 2,400 stores across North America.
It’s about a third of the size of Home Depot Inc (NYSE:HD) by market cap, but its size is good in an expanding market since every sale means more to its bottom line.
And right now, as interest rates rise, and people are choosing to stay in their homes, banks are starting to push home equity lines again. That is a great sign for the home-improvement market.
Housing values are rising since demand is limited and people are grabbing low-interest-rate home equity lines to pay off debt and add value to their properties. All good signs for Lowe’s.
High-Growth Stocks to Buy: Five Below (FIVE)
Five Below Inc (NASDAQ:FIVE) is a specialty retail chain that sells everything in the store for $5 or below.
Since the Great Recession, consumers have been looking for ways to make their money go further, and FIVE became a popular store for anything from birthday party gift bags to beach towels to jewelry to electronics accessories. And all geared toward the pre-teen and teen markets.
Last year, earnings per share grew 200% and this year Zacks is expecting EPS growth of 38% with long-term growth above 25%. FIVE stock’s 66% run in the past 12 months is a bullish prologue.
High-Growth Stocks to Buy: Arista (ANET)
Arista Networks Inc (NYSE:ANET) has had quite a 12 months.
ANET stock is up 161% in that time and every sign points to it continuing above average growth for the foreseeable future.
Essentially, ANET is a cloud solutions provider. It builds the switches and the software that allow cloud computing operations to run quickly, efficiently and reliably.
What makes it unique is, it isn’t tied down by the challenges of legacy systems that some of the big server companies have to deal with. It’s coming at the problem with fresh solutions that are game changing for cloud operators.
High-Growth Stocks to Buy: Penn National (PENN)
Penn National Gaming, Inc (NASDAQ:PENN) owns and operates more than 20 horse racing and gaming facilities across the U.S. and Canada.
In the U.S., it operates in 16 states, recently buying the legendary Tropicana casino in Las Vegas.
As the U.S. economy recovers and wages expand, more people will head to the gaming tables and race tracks to try their luck with their extra money.
Given its diversification across the U.S. and its right-sized properties, PENN can maximize its revenue better than larger concerns, especially in the early growth phase of the comeback.
PENN stock is up more than 135% in the past 12 months and the P/E is still at a stunning 3.6.
High-Growth Stocks to Buy: Toll Brothers (TOL)
Toll Brothers Inc (NYSE:TOL) is one of the top homebuilders in the country.
Operating in 21 states, it focuses on the luxury end of the home market, usually suburban communities centered around large urban areas.
While interest rates have been very low for a long time, banks weren’t too interested in lending. But that is beginning to change. And now, as rates rise, banks are opening up to lending and this is a great time for homebuilders.
Up 67% in the past 12 months and still trading at a PE of 16, TOL is still undervalued.
High-Growth Stocks to Buy: Pilgrim’s Pride (PPC)
Pilgrim’s Pride Corporation (NASDAQ:PPC) has been around for over 60 years and is one of the leading chicken producers in the U.S. It has operations in 14 states (mostly the South), Puerto Rico and Mexico.
PPC says that 1 of every 5 chickens in the U.S. comes from them. And that isn’t too surprising given the fact that PPC’s 4,000 family farms produce 10 billion pounds of chickens annually.
Chicken farming on this scale has been consolidated down to a few major processors. Basically chicks are delivered to farmers who raise the birds until they’re of the proper size to harvest. They’re then returned to PPC, who processes the birds and distributes them to markets.
While pressure has been on growers to improve living conditions and lower the use of drugs to keep the birds healthy, that has also driven demand for chicken over other proteins.
PPC has been a beneficiary and will continue to be as consumers eat healthier and can afford to buy more quality meats.
High-Growth Stocks to Buy: Polaris (PII)
Polaris Industries Inc (NYSE:PII) specializes in building off-road vehicles, including all-terrain vehicles and snowmobiles. It has also added Victory and Indian motorcycles to its product lines.
In 1955, the founders of PII built the first snow machine to get back and forth to their workshop in Minnesota during the winter. To prove they weren’t just toys, the founders then took their machines on a 1,200 mile trip through Alaska — in 12 days.
Now the line has significantly expanded to machines that are better suited for rugged terrain that may or may not have snow. And many farmers and outdoors enthusiasts have adopted them over 4×4 automobiles to get into (and out of) challenging off-road destinations.
Up almost 50% in the past 12 months, these vehicles’ adoption rate is continuing to grow. And so will PII’s earnings.
High-Growth Stocks to Buy: Sony (SNE)
Sony Corporation (ADR) (NYSE:SNE) is finally making it back from years of lackluster performance. For example, SNE’s 10-year stock performance is still underwater. It has yet to get back to its levels before the market crash.
But that has all changed. In 2017, a number of developments will help SNE make some headway in its various divisions.
With content mergers starting to happen, SNE can either shop its Columbia Studios division, or buy another studio. It can sell its gaming division to interested Chinese gaming companies or find some lucrative licensing deals.
SNE stock was up 62% in the past 12 months yet the stock trades at a current P/E of 27. This year is going to be another exciting one for SNE.
High-Growth Stocks to Buy: PRA Health (PRAH)
PRA Health Sciences Inc (NASDAQ: PRAH) is a new generation of biotech firms. It specializes in outsourced clinical trial work.
Nowadays, it costs about $2 billion to get a big drug through trials. It’s a long, expensive process to say the least. For big biotech and pharmaceutical companies, many times it’s more efficient to farm out the drug trials to a company line PRAH that specialize in doing all the work drug trials require.
That way, the drug maker can focus on developing drugs and after they’re through trials, getting them to market. It’s a win-win for both PRAH and the drug makers. And that’s why this new approach is becoming so popular.
Up 55% in the past 12 months, PRAH hit a 52-week high in late December and has backed off slightly. Don’t hesitate.
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.