While current stock-related headlines fixate on trade war and tariffs, oil prices, and real estate bubbles, little financial advice seems to be doing the rounds for risk investors.
To remedy that, here are three stocks that have very high growth curves ahead of them. To minimize the risk, only the safest of high-growth stocks have been chosen.
Guyana Goldfields Inc. (TSX:GUY)
Still selling at a discount of 13%, Guyana Goldfields is a super-healthy high-growth stock. It has some physical assets, as you may expect for a gold mine stock, but very low debt at 14.2%. Coupled with an expected growth of 38.6% in annual earnings, Guyana Goldfields is one of those rare finds on the TSX: a healthy, high-growth stock that’s both good value and super defensive.
Compare that with another popular gold stock, Goldcorp Inc. (TSX:G)(NYSE:GG), and you’ll see that you have a great chance to invest in defensive investors’ favourite commodity but with a greater future yield. Goldcorp is looking at future annual earnings growth in the region of 14%, less than half Guyana Goldfields’, while it also holds more unsold assets and debt. That said, Goldcorp offers a dividend of 0.56%, whereas Guyana Goldfields does not.
Proton exchange membranes (PEMs) are a growing market, and Ballard Power Systems is well placed to meet demand. If you want an idea of how high demand is at the moment, look at Ballard Power Systems’s expected annual growth in earnings of 72% — one of the highest sustainable growth rates on the TSX. We stress “sustainable” since not all growth is liable to materialize, especially given a decidedly rocky outlook for the global economy.
Case in point: Ballard Power Systems holds a minuscule amount of debt. At just 5.7%, this stock’s low level of liabilities makes it a nearly perfect example of a growth stock on the TSX.
Park Lawn Corp. (TSX:PLC)
Expectations of an annual earnings growth of 47.3% are breathing new life into this major funeral industry stock. Park Lawn has beaten off stiff competition to become one of the liveliest stocks in its field, providing disposal and memorial services.
Its share price has risen of late and is currently up to $23.95. Unfortunately, this has killed the value opportunity that was still alive and kicking only last week. Still, growth investors are encouraged to think outside the box before turfing this stock out of their wish list. This is a very healthy company, with low levels of debt and a small physical asset footprint. Offering a 1.9% yield, it’s still got the vital signs of a stock worth shoveling into your portfolio.
The bottom line
High-growth stocks are a contrarian’s dream at the moment, as some more timid outlooks call for defensive buying ahead of a deepening bear market. If your portfolio is sufficiently insulated against a crash, by all means, speculate on some high-growth stocks. Gold is famously defensive, so you can’t go wrong with Guayana Goldfields, while Park Lawn is one of those perennial stocks that even the worst recession will only strengthen. Meanwhile, hardcore tech investors shouldn’t duck out on Ballard Power Systems, with its strong international business model.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Victoria Hetherington has no position in any of the stocks mentioned.