Editor’s note: This story was previously published in October 2018. It has since been updated and republished.
The benefit of fast-growing stocks is self-evident, but as inflation becaomes something to start worrying about, fast-growing stocks have an importance tied to timing. If you haven’t noticed, there has been a lot of talk about something that we haven’t heard about for almost a decade, inflation.
For nearly a decade, the Federal Reserve and all the central banks in all the industrialized nations have been managing interest rates to keep them outrageously low until the financial system had a chance to right itself.
Now, we’re in the next phase of that great experiment. Economies are coming back online and central banks are raising interest rates to keep inflation a bay while not shutting off the green shoots of growth.
But this isn’t a science. It’s a bit messy. It means that growth will be more uneven than it has been in the past. You need to find firms with solid sales earnings growth as well as technical and fundamental strengths to keep the profits rolling.
These are seven fast-growing stocks to buy today that will keep you in good stead for years to come.
Kronos Worldwide (KRO)
Kronos Worldwide, Inc. (NYSE: KRO) has a $2 billion market cap and is a very focused firm. It produces titanium dioxide (TiO2). The thing is, TiO2 has a very practical purpose that is used in a number of industries; it provides whiteness, brightness and opacity.
As one of the leading providers of TiO2 in Europe and the U.S., its product is used in paints, coloring agents, plastics, rubber, silicone, ceramics, glass, the list goes on. It’s a basic building block for an enormous amount of industrial and commercial applications.
And as growth resumes and more products are sold, KRO will benefit by supplying a key ingredient to many of those products.
Besides being one of our favorite a fast-growing stocks KRO also hands out a 4.12% dividend and trades a sub-8 price-earnings ratio.
Sherwin-Williams Co (NYSE:SHW) has sold paint and coatings now for 152 years. That’s a pretty impressive record. But it’s a bit unusual to see a paint company in a list of top growth stocks. Usually, it’s some cloud storage firm or a breakout online retailer.
However, SHW, by its size and reputation, has not only endured but it has positioned itself on top of the coatings heap. It grew from annual sales of $400,000 in 1866 to annual sales topping $15 billion last year, coming from over 100 countries around the world.
Its size, scope and quality is one reason hardware giant Lowe’s Companies, Inc. (NYSE:LOW) just inked a deal to be the only nationwide home seller to offer SHW products. This is even more exciting given that housing demand is back on track and the interest in homeowners to fixing up their current houses.
Vertex Pharmaceuticals (NASDAQ:VRTX) is one of the leading pharmaceuticals firms when it comes to treating cystic fibrosis (CF). That may not seem like much of a franchise given all the other more compelling diseases out there, but VRTX has built a $41 billion market cap in the sector and most of its competitors are looking for other places to find an opening.
That is a big deal for pharma companies that usually are strong until patents run down or generics start eating into margins.
Not so with VRTX. As new approvals keep rolling in for next-generation CF drugs, it has plenty more in the pipeline to keep this growth going.
Valero Energy (VLO)
Valero Energy Corporation (NYSE:VLO) is one of the top refiners in the U.S. It now has 15 oil refineries which supply 3.1 million barrels per day, and its 11 ethanol plants deliver 1.4 billion gallons of ethanol per year. Its operations now stretch across the U.S., Canada, the U.K. and Ireland.
When the economy is in a growth phase, refineries are a great place to have your money. They are one of the leading economic indicators since demand for fuel is a key sign more the economy is coming back. More demand for fuel means there’s more transportation of goods and services.
There’s no doubt that refining is as cyclical as most parts of the energy sector, but when times are good, they’re very good. And times are getting better every day in the energy patch.
Royal Dutch Shell (RDS.A)
Royal Dutch Shell (NYSE:RDS.A, NYSE:RDS.B) is one of the biggest players in the global energy markets. With a $300 billion market cap, the only Big Oil that’s bigger is Exxon Mobil (NYSE:XOM). It’s what is called an integrated energy company because it has operations from the fields to the pipelines to the refineries to the distribution.
As with all energy firms, when times are bad, the more exposure you have to the entire production and distribution process, the tougher things get. But at the size the big oils are, they have the money to wait out the bad patches.
And that’s just what RDS.A has done. Now it’s time to cash in. What’s more, RDS.A is still delivering a mouth-watering 7.4% dividend, but that may wane as the stock price starts rising. In the meanwhile, it’s easy to see why this is one of our picks for the best fast-growing stocks.
Lumentum Holdings Inc (NASDAQ: LITE) is a specialty company that focuses on laser beams. It’s one of the biggest optical and photonics companies in the world that is working on the 3D sensing sector.
Essentially, 3D sensing is basically the gesture sensing that we all have become accustomed with in our mobile devices, screens in our cars, etc. It is one of the most ubiquitous aspects of our interactive age and one of the key parts of the Internet of Things (IoT) concept.
What’s more, LITE is also a major player in the optical networking space that makes the infrastructure that makes our world “smarter,” operating in as close to real time as possible. It’s crucial for the next generation of cloud computing and network operations.
Its laser division helps build the next generation of equipment that makes all this possible.
Knight-Swift Transportation Holdings Inc (NYSE:KNX) had its humble beginnings in 1966, taking steel from the Port of Los Angeles to Arizona and bringing cotton from Arizona to LA.
Today, KNX is a $5.8 billion business with 20,000 trucks on the road throughout the U.S. and Mexico. If you see a Swift logo on a truck while driving, it’s a KNX truck.
Charles Dow, the inspiration for the Dow Jones Industrial Average, also inspired a fundamental theory about the economy and the markets. It’s simply called Dow Theory.
One of the core tenants is that if you look at the transportation and the industrial sectors, you can predict how well the economy will be doing in the near future. If the transport business is rising, that’s a bullish sign that the economy is on an upswing and KNX stock with it.
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.