As we get ready to welcome 2018, many investors have started to hunt for growth stocks that are positioned to continue their upward journey next year.
There is, of course, no guarantee in the world of investing. Nobody can predict accurately what is going to happen in 2018 at a time when top indexes are trading at a record level and when equity investors are well on course to close one of the best years.
Going into 2018, there is no immediate threat to economies in the developed world. Corporate earnings have been strong, inflation is under check, and the unemployment rate continues to decline.
This positive outlook is a great news for investors, who have not seen any major downturn since the Financial Crisis of 2008. Here are two growth stocks I think still have some steam left after a remarkable rally in 2017.
Helped by improving economies in North America, higher disposable incomes, and falling fuel prices, Air Canada was one of the most favoured momentum stocks in 2017. The stock surged to a record high and handed in 82% capital gains to investors.
Many analysts have recently raised their targets on Air Canada shares, showing confidence in the company’s financial strength and its turnaround plan. Air Canada is targeting to increase its margins between 17% and 20% and projected free cash flow of up to $3 billion by the end of 2020.
The airline estimates it will add between $2 and $2.5 billion in value once it launches its own loyalty program after it decided to end its partnership with Aeroplan.
I think the factors that propelled Air Canada’s stock this year are going to stay as we enter 2018. With the 12-month trailing price-to-earnings multiple of just 8.3, Air Canada stock still offers attractive value for your 2018 shopping list.
BlackBerry Ltd. (TSX:BB)(NYSE:BB) can prove to be a great turnaround story for 2018. If you are comfortable with the stock’s roller-coaster ride, then there is a good chance that BlackBerry stock will not disappoint investors next year.
The biggest reason getting me excited about the future of this troubled technology company is the renewed focus by global firms on the network security after some high-profile security breaches in 2017.
As pointed out by fellow analyst, Chris MacDonald, in a recent article, BlackBerry is in a perfect position to take advantage of this massive opportunity.
BlackBerry has been counting on its flagship software and services business for long-term growth, especially marketing the security feature of its software when every top company on the planet is beefing up investments on their systems to protect their assets from hackers.
For example, its QNX operating system, which powers automobiles’ infotainment systems, offers great security features for companies that are working to roll out self-driving cars.
BlackBerry has surged 47% in 2017, but I do not think it has run out of steam. Betting on this turnaround story may still prove to be a very profitable trade for the next year.
While conflict overseas is all media talking-heads seem to mention these days, the billionaire founder of Tesla is losing sleep over what he sees as a far bigger threat.
Elon Musk Warns: This has “vastly more risk than North Korea”
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Fool contributor Haris Anwar has no position in any stocks mentioned.